Category: Finance

  • MIL-OSI: Phunware Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    New Customer Launches Drive 40% Revenue Growth for Software Subscriptions and Services

    Strong Balance Sheet of $109.7 Million Powering R&D Activities in AI-Driven Customer Platform and Corporate Initiatives

    AUSTIN, Texas, May 12, 2025 (GLOBE NEWSWIRE) — Phunware, Inc. (“Phunware” or the “Company”) (NASDAQ: PHUN), a leader in enterprise cloud solutions for mobile applications, today reported financial results for the first quarter ended March 31, 2025.

    Financial Highlights

    • Software subscriptions and services revenue increased 40% to $0.6 million in Q1 2025, as compared to Q1 2024.
    • Q1 2025 software and subscription bookings totaled $0.4 million.
    • Net loss was $3.7 million for the three months ended March 31, 2025, as compared to $2.3 million in the previous year period.
      • Primary driver for net loss increase was $1.2 million one-time legal expenses related to the Wild Basin litigation bench trial that concluded in Q1 2025; a decision is expected in Q3 2025.
    • Net loss per share improved to ($0.18) per share in Q1 2025, as compared to ($0.33) per share in Q1 2024.
    • Net cash used in operations decreased to $3.3 million for the three months ended March 31, 2025, compared to $5.5 million for the previous year period.
    • Cash and cash equivalents as of March 31, 2025, was $109.7 million.

    Recent Business Highlights

    • During Q1 2025, added three (3) new customers in the hospitality vertical. Momentum carried into Q2, with a new $0.5 million booking for a multi-location health care facility.
    • Appointed Quyen Du to the Board of Directors, a 25-year corporate strategy and development executive with Fortune 500 consumer brands.
      • Her appointment satisfies Nasdaq Stock Market LLC (“Nasdaq”) continued listing requirements for audit committee service.
    • Attended investor and industry conferences including the 37th Annual ROTH Conference and upcoming 2025 Hospitality Industry Technology Exposition and Conference (HITEC®) June 16–19 in Indianapolis, Indiana.

    Management Commentary

    “The first quarter of 2025 was underscored by new customers and bookings and continued focus on our AI-related initiatives,” said interim CEO Stephen Chen. “First quarter revenues of $0.7 million and gross margin of 52% were driven by a 40% increase in Mobile software subscriptions and services with delivered customer projects. With an existing hospitality customer, we launched an integrated conference solution including dynamic wayfinding, mobile engagement messaging, events scheduling, and content management. With a well-known resort and entertainment venue customer, we launched our hospitality industry solution application to enhance guest experiences.”

    “Software bookings for the first quarter were $0.4 million and we continue to accelerate our pipeline while simultaneously shortening the sales cycle. With three new customers in the hospitality vertical during the first quarter, and a $0.5 million multi-location health care facility booking in the second quarter, we believe customer momentum continues to accelerate.”

    “We were honored to appoint Quyen Du to our Board of Directors in February. Ms. Du brings 25 years’ experience in strategy and corporate development as an executive at Fortune 500 consumer brands. She has an impressive record of guiding strategic growth and will add tremendous expertise to our Board for Phunware investments, M&A and new business development strategies. We are happy to announce that Ms. Du was elected to three-year term at our most recent stockholders’ meeting.”

    “While we’ve seen some softness in the ad market, we are focused on new opportunities in that market and investing in marketing and research and development in generative and agentic AI initiatives, among others. We remain committed to reinforcing our core business units, identifying high-impact investment and M&A opportunities, driving operational excellence, and aligning our cost structure for long-term scalability. We are also committed to enhancing our team with experienced sales, marketing, and technology professionals to amplify market visibility and accelerate customer acquisition.”

    “Looking ahead, we are developing additional features and functionalities for our existing products, including AI-related features such as AI Personal Concierge for hospitality customers and their guests and Intelligent Reporting for large real property owners. We expect to launch the initial AI Personal Concierge product in mid-2025. With our leadership position in mobile app development, combined with compelling new technology improvements and AI integration, we are executing on our strategic vision to deliver our solutions globally. I look forward to additional announcements and milestones in the months ahead,” concluded Chen.

    Note about Non-GAAP Financial Measures

    A non-GAAP financial measure is a numerical measure of a company’s performance, financial position, or cash flows that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with accounting principles generally accepted in the United States of America, or GAAP. Non-GAAP measures are not in accordance with, nor are they a substitute for, GAAP measures. Other companies may use different non-GAAP measures and presentation of results.

    In addition to financial results presented in accordance with GAAP, this press release presents adjusted EBITDA, which is a non-GAAP measure. Adjusted EBITDA is determined by taking net loss and adding interest expense (income), income tax expense, depreciation, and further adjusted for non-cash impairment, valuation adjustments and stock-based compensation expense. The company believes that this non-GAAP measure, viewed in addition to and not in lieu of net loss, provides additional information to investors by providing a more focused measure of operating results. This metric is an integral part of the Company’s internal reporting to evaluate its operations and the performance of senior management. A reconciliation of adjusted EBITDA to net loss, the most comparable GAAP measure, is available in the accompanying financial tables below. The non-GAAP measure presented herein may not be comparable to similarly titled measures presented by other companies.

           
    US-GAAP NET LOSS TO ADJUSTED EBITDA RECONCILIATION
    (Unaudited)
           
        Three Months Ended March 31,  
    (in thousands)   2025     2024  
    Net loss   $ (3,723 )   $ (2,292 )
    Add back: Depreciation     4       4  
    Add back: Interest expense     9       108  
    Less: Interest income     (1,119 )     (140 )
    EBITDA     (4,829 )     (2,320 )
    Add back: Stock-based compensation     86       630  
    Less: Gain on extinguishment of debt           (535 )
    Adjusted EBITDA   $ (4,743 )   $ (2,225 )
                     

    About Phunware

    Phunware, Inc. (NASDAQ: PHUN) is an enterprise software company specializing in mobile app solutions with integrated intelligent capabilities. We provide businesses with the tools to create, implement, and manage custom mobile applications, analytics, digital advertising, and location-based services. Phunware is transforming mobile engagement by delivering scalable, personalized, and data-driven mobile app experiences.

    Phunware’s mission is to achieve unparalleled connectivity and monetization through the widespread adoption of Phunware mobile technologies, leveraging brands, consumers, partners, digital asset holders, and market participants. Phunware is poised to expand its software products and services audience through a new Generative AI platform which is in development, utilize and monetize its patents and other intellectual property, and renewed focus on development of a digital asset ecosystem for existing holders and new market participants.

    For more information on Phunware, please visit www.phunware.com. To better understand and leverage generative AI and Phunware’s mobile app technologies, visit ai.phunware.com.

    Safe Harbor / Forward-Looking Statements

    This press release includes forward-looking statements. All statements other than statements of historical facts contained in this press release, including statements regarding our future results of operations and financial position, business strategy and plans, and our objectives for future operations, are forward-looking statements. The words “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “will,” and similar expressions are intended to identify forward-looking statements. For example, Phunware is using forward-looking statements when it discusses the adoption and impact of emerging technologies and their use across mobile engagement platforms. The forward-looking statements contained in this press release are based on our current expectations and beliefs concerning future developments and their potential effects on us. These forward-looking statements involve risks, uncertainties, and other assumptions that may cause actual results to differ materially from those expressed or implied. These risks and uncertainties include, but are not limited to, those factors described under the heading “Risk Factors” in our filings with the SEC. We undertake no obligation to update any forward-looking statements.

    By their nature, forward-looking statements involve risks and uncertainties. We caution you that forward-looking statements are not guarantees of future performance and that our actual results may differ materially from those expressed or implied by these forward-looking statements.

    Investor Relations Contact:
    Chris Tyson, Executive Vice President
    MZ Group – MZ North America
    949-491-8235
    PHUN@mzgroup.us
    www.mzgroup.us

    Phunware Media Contact:
    Joe McGurk, Managing Director
    917-259-6895
    PHUN@mzgroup.us

               
    Phunware, Inc.
    Consolidated Balance Sheets
    (In thousands, except share and per share data)
               
      March 31,     December 31,  
      2025     2024  
    Assets: (Unaudited)        
    Current assets:          
    Cash and cash equivalents $ 109,719     $ 112,974  
    Accounts receivable, net of allowance for credit losses of $264 and $166 as of March 31, 2025 and December 31, 2024, respectively   697       276  
    Digital currencies   82       103  
    Prepaid expenses and other current assets   588       406  
    Total current assets   111,086       113,759  
    Non-current assets:          
    Property and equipment, net   20       24  
    Right-of-use asset   770       840  
    Other assets   158       158  
    Total non-current assets   948       1,022  
    Total assets $ 112,034     $ 114,781  
               
    Liabilities and stockholders’ equity          
    Current liabilities:          
    Accounts payable $ 4,073     $ 3,754  
    Accrued expenses   492       148  
    Deferred revenue   1,124       1,034  
    Lease liability   320       313  
    PhunCoin subscription payable   1,202       1,202  
    Total current liabilities   7,211       6,451  
    Deferred revenue   660       528  
    Lease liability   537       619  
    Total noncurrent liabilities   1,197       1,147  
    Total liabilities   8,408       7,598  
    Commitments and contingencies (See Note 7)          
    Stockholders’ equity          
    Common stock, $0.0001 par value, 1,000,000,000 shares authorized; 20,180,875 shares issued and 20,170,745 share outstanding as of March 31, 2025 and 20,166,665 shares issued and 20,156,535 shares outstanding as of December 31, 2024   2       2  
    Treasury Stock   (502 )     (502 )
    Additional paid-in capital   421,169       421,003  
    Accumulated deficit   (317,043 )     (313,320 )
    Total stockholders’ equity   103,626       107,183  
    Total liabilities and stockholders’ equity $ 112,034     $ 114,781  
                   
    Phunware, Inc.
    Consolidated Statements of Operations and Comprehensive Loss
    (In thousands, except share and per share information)
         
      Three Months Ended  
      March 31,  
      2025     2024  
               
    Net revenues $ 688     $ 921  
    Cost of revenues   329       397  
    Gross profit   359       524  
    Operating expenses:          
    Sales and marketing   896       443  
    General and administrative   3,464       2,471  
    Research and development   813       484  
    Total operating expenses   5,173       3,398  
    Operating loss   (4,814 )     (2,874 )
    Other income (expense):          
    Interest expense   (9 )     (108 )
    Interest income   1,119       140  
    Gain on extinguishment of debt         535  
    Other (expense) income, net   (19 )     15  
    Total other income   1,091       582  
    Loss before taxes   (3,723 )     (2,292 )
    Income tax expense          
    Net loss   (3,723 )     (2,292 )
    Net loss per share, basic and diluted $ (0.18 )   $ (0.33 )
    Weighted-average shares used to compute net loss per share, basic & diluted   20,169,640       6,864,226  
                   
    Phunware, Inc.
    Consolidated Statements of Cash Flows
    (In thousands)
         
      Three Months Ended  
      March 31,  
      2025     2024  
    Operating activities          
    Net loss $ (3,723 )   $ (2,292 )
    Adjustments to reconcile net loss to net cash used in operating activities:          
    Gain on extinguishment of debt         (535 )
    Stock-based compensation   86       630  
    Other adjustments   132       329  
    Changes in operating assets and liabilities:          
    Accounts receivable   (444 )     (82 )
    Prepaid expenses and other assets   (182 )     (11 )
    Accounts payable and accrued expenses   663       (2,893 )
    Lease liability payments   (89 )     (185 )
    Deferred revenue   222       (286 )
    Net cash used in operating activities from continued operations   (3,335 )     (5,325 )
    Net cash used in operating activities from discontinued operations         (205 )
    Net cash used in operating activities   (3,335 )     (5,530 )
    Investing activities          
    Net cash provided by (used in) investing activities          
    Financing activities          
    Proceeds from sales of common stock, net of issuance costs   80       23,204  
    Net cash provided by financing activities   80       23,204  
               
    Effect of exchange rate on cash         (41 )
    Net (decrease) increase in cash and cash equivalents   (3,255 )     17,633  
    Cash and cash equivalents at the beginning of the period   112,974       3,934  
    Cash and cash equivalents at the end of the period $ 109,719     $ 21,567  
               
               
    Supplemental disclosure of cash flow information          
    Interest paid $ 9     $ 4  
    Income taxes paid $     $ 26  
    Supplemental disclosures of non-cash financing activities:          
    Issuance of common stock upon conversion of the 2022 Promissory Note $     $ 4,505  
    Issuance of common stock for payment of bonuses and consulting fees $     $ 35  
                   

    The MIL Network

  • MIL-OSI: Rapid7 Announces First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    • Annualized recurring revenue (“ARR”) of $837 million, an increase of 4% year-over-year
    • Total revenue of $210 million, up 3% year-over-year; Product subscriptions revenue of $204 million, up 4% year-over-year
    • GAAP operating loss of $0.1 million; Non-GAAP operating income of $32 million
    • Net cash provided by operating activities of $30 million; Free cash flow of $25 million

    BOSTON, May 12, 2025 (GLOBE NEWSWIRE) — Rapid7, Inc. (Nasdaq: RPD), a leader in extended risk and threat detection, today announced its financial results for the first quarter 2025.

    “We had a slower start to 2025 than anticipated however we have a clear strategy and strong conviction in our long-term opportunity,” said Corey Thomas, Chairman and CEO of Rapid7. “Against a more uncertain macroeconomic environment, we are executing with increased focus and urgency—investing behind our leadership in MDR, accelerating Exposure Command adoption, and sharpening our go-to-market engine. We believe these steps position us for improved ARR in the second half of the year and beyond. At the same time, we remain committed to operational discipline and delivering strong free cash flow in 2025.”

    First Quarter 2025 Financial Results and Other Metrics

      As of March 31,
      2025
      2024
      % Change
      (dollars in thousands)
    ARR $ 837,220     $ 807,196     4 %
    Number of customers   11,685       11,462     2 %
    ARR per customer $ 71.6     $ 70.4     2 %
      Three Months Ended March 31,
      2025   2024   % Change
      (in thousands, except per share data)
    Product subscriptions revenue $ 203,935     $ 196,918     4 %
    Professional services revenue   6,318       8,183     (23 %)
    Total revenue $ 210,253     $ 205,101     3 %
               
    North America revenue $ 157,945     $ 157,340     %
    Rest of world revenue   52,308       47,761     10 %
    Total revenue $ 210,253     $ 205,101     3 %
               
    GAAP gross profit $ 150,773     $ 144,107      
    GAAP gross margin   72 %     70 %    
    Non-GAAP gross profit $ 157,460     $ 151,112      
    Non-GAAP gross margin   75 %     74 %    
               
    GAAP (loss) income from operations $ (101 )   $ 9,716      
    GAAP operating margin   %     5 %    
    Non-GAAP income from operations $ 32,353     $ 40,285      
    Non-GAAP operating margin   15 %     20 %    
               
    GAAP net income $ 2,105     $ 1,406      
    GAAP net income per share, basic $ 0.03       0.02      
    GAAP net income per share, diluted $ 0.03     $ 0.02      
    Non-GAAP net income $ 35,578     $ 39,388      
    Non-GAAP net income per share:          
    Basic $ 0.56     $ 0.64      
    Diluted $ 0.49     $ 0.55      
               
    Adjusted EBITDA $ 38,898     $ 46,619      
               
    Net cash provided by operating activities $ 29,757     $ 31,070      
    Free cash flow $ 24,677     $ 27,534      
                       

    For additional details on the reconciliation of non-GAAP measures and certain other business metrics to their nearest comparable GAAP measures, please refer to the accompanying financial data tables included in this press release. The prior year period reflects an immaterial correction. Refer to Note 16, Immaterial Correction of an Error, in the notes to our unaudited condensed consolidated financial statements for further information.

    Recent Business Highlights

    • In April, Rapid7 launched unified threat-informed remediation for its Command Platform, delivering effective remediation at scale via proactive exposure remediation and AI-assisted automated detection and response. In addition to these enhancements to the Command Platform, Rapid7 also launched Breach Protection Warranty, offering MTC (Managed Thread Complete) Ultimate customers up to $1,000,000 in coverage embedded directly into the service.
    • In April, Rapid7 launched Managed Detection & Response (MDR) for Enterprise, a fully managed and customizable detection and response service designed to meet the unique demands of complex, distributed enterprise environments.
    • In April, Rapid7 introduced Intelligence Hub within its Command Platform, an integrated threat intelligence solution designed to provide security teams with meaningful context and actionable insights for accelerated detection and response.
    • In March, Rapid7 announced the appointment of three new members to its Board of Directors: Wael Mohamed, Mike Burns, and Kevin Galligan. These strategic appointments reinforce the company’s commitment to scaling the business, enhancing operational efficiency, and driving long-term shareholder returns.
    • In March, Rapid7 announced plans for expansion in India, including the opening of a global capacity center, which will serve as a Security Operations Center (SOC) and innovation hub to house technology, security operations, customer support, and IT teams.

    Second Quarter and Full Year 2025 Guidance

    Rapid7 anticipates ARR, revenue, non-GAAP income from operations, non-GAAP net income per share and free cash flow to be in the following ranges:

      Second Quarter 2025   Full-Year 2025
      (in millions, except per share data)
    ARR         $850 to $880
    Year-over-year growth         1% to 5%
    Revenue $211 to $213   $853 to $863
    Year-over-year growth 1% to 2%   1% to 2%
    Non-GAAP income from operations $30 to $32   $125 to $135
    Non-GAAP net income per share $0.43 to $0.46   $1.78 to $1.91
    Weighted average shares outstanding 75.3   76.7
    Free cash flow         $125 to $135
                   

    The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. Guidance for the second quarter 2025 does not include any potential impact of foreign exchange gains or losses. The guidance provided above is based on a number of assumptions, estimates and expectations as of the date of this press release and, while presented with numerical specificity, this guidance is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Rapid7’s control and are based upon specific assumptions with respect to future business decisions or economic conditions, some of which may change. Rapid7 undertakes no obligation to update guidance after this date.

    Non-GAAP guidance excludes estimates for stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs, and certain other items such as acquisition-related expenses, impairment of long-lived assets, restructuring expense, induced conversion expense, change in the fair value of derivative assets, litigation-related expenses and discrete tax items. Rapid7 has provided a reconciliation of each non-GAAP guidance measure to the most comparable GAAP measures in the financial statement tables included in this press release. The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty.

    Conference Call and Webcast Information

    Rapid7 will host a conference call today, May 12, 2025, to discuss its results at 4:30 p.m. Eastern Time. The call will be accessible by telephone at 888-330-2384 (domestic) or +1 240-789-2701 (international) with the event code 8484206. The call will also be available live via webcast on Rapid7’s website at https://investors.rapid7.com. A webcast replay of the conference call will be available at https://investors.rapid7.com.

    About Rapid7

    Rapid7 (Nasdaq: RPD) is on a mission to create a safer digital world by making cybersecurity simpler and more accessible. We empower security professionals to manage a modern attack surface through our best-in-class technology, leading-edge research, and broad, strategic expertise. Rapid7’s comprehensive security solutions help more than 11,000 global customers unite cloud risk management and threat detection to reduce attack surfaces and eliminate threats with speed and precision. For more information, visit our website, check out our blog, or follow us on LinkedIn or Twitter.

    Non-GAAP Financial Measures and Other Metrics

    To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we provide investors with certain non-GAAP financial measures and other metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We also use certain non-GAAP financial measures as performance measures under our executive bonus plan. We believe that these non-GAAP financial measures and other metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

    While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, you should review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate our business.

    Non-GAAP Financial Measures

    We disclose the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, adjusted EBITDA and free cash flow. We also disclose non-GAAP gross margin and non-GAAP operating margin derived from these financial measures.

    We define non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share as the respective GAAP balances excluding the effect of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs and certain other items such as acquisition-related expenses, impairment of long-lived assets, change in the fair value of derivative assets, restructuring expense, induced conversion expense and discrete tax items. Non-GAAP net income per basic and diluted share is calculated as non-GAAP net income divided by the weighted average shares used to compute net income per share, with the number of weighted average shares decreased, when applicable, to reflect the anti-dilutive impact of the capped call transactions entered into in connection with our convertible senior notes.

    We believe these non-GAAP financial measures are useful to investors in assessing our operating performance due to the following factors:

    Stock-based compensation expense. We exclude stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact our non-cash expense. We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period.

    Amortization of acquired intangible assets. We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.

    Amortization of debt issuance costs. The expense for the amortization of debt issuance costs related to our convertible senior notes and our former revolving credit facility is a non-cash item, and we believe the exclusion of this interest expense provides a more useful comparison of our operational performance in different periods.

    Induced conversion expense. In conjunction with the third quarter of 2023 partial repurchase of our 2.25% convertible senior notes due 2025, we incurred a non-cash induced conversion expense of $53.9 million. We exclude induced conversion expense because this amount is not indicative of the performance of or trends in our business, and neither is comparable to the prior period nor predictive of future results.

    Litigation-related expenses. We exclude non-ordinary course litigation expense because we do not consider legal costs and settlement fees incurred in litigation and litigation-related matters of non-ordinary course lawsuits and other disputes to be indicative of our core operating performance. We do not adjust for ordinary course legal expenses, including legal costs and settlement fees resulting from maintaining and enforcing our intellectual property portfolio and license agreements.

    Acquisition-related expenses. We exclude acquisition-related expenses, including accretion expense associated with contingent consideration, as costs that are unrelated to the current operations and are neither comparable to the prior period nor predictive of future results.

    Change in fair value of derivative assets. The expense for the change in fair value of derivative assets related to our 2023 capped calls settlement is a non-cash item and we believe the exclusion of this other income (expense) provides a more useful comparison of our operational performance in different periods.

    Impairment of long-lived assets. Impairment of long-lived assets consists of impairment charges allocated to the carrying amount of certain operating right-of-use assets and the associated leasehold improvements when the carrying amounts exceed their respective fair values and we believe the exclusion of the impairment charges provides a more useful comparison of our operational performance in different periods.

    Restructuring expense. We exclude non-ordinary course restructuring expenses related to our restructuring plan, that was completed during fiscal year 2024, because we do not believe these charges are indicative of our core operating performance and we believe the exclusion of the restructuring expenses provides a more useful comparison of our performance in different periods.

    Discrete tax items. We exclude certain discrete tax items such as income tax expenses or benefits that are not related to ongoing business operations in the current year and adjustments to uncertain tax position reserves as these charges are not indicative of our ongoing operating results, and they are not considered when we are forecasting our future results.

    Anti-dilutive impact of capped call transaction. Our capped call transactions are intended to offset potential dilution from the conversion features in our convertible senior notes. Although we cannot reflect the anti-dilutive impact of the capped call transactions under GAAP, we do reflect the anti-dilutive impact of the capped call transactions in non-GAAP net income (loss) per diluted share, when applicable, to provide investors with useful information in evaluating our financial performance on a per share basis.

    Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure that we define as net income (loss) before (1) interest income, (2) interest expense, (3) other (income) expense, net, (4) provision for (benefit from) income taxes, (5) depreciation expense, (6) amortization of intangible assets, (7) stock-based compensation expense, (8) acquisition-related expenses, and (9) restructuring expense. We believe that the use of adjusted EBITDA is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods.

    Free Cash Flow. Free cash flow is a non-GAAP measure that we define as cash provided by operating activities less purchases of property and equipment and capitalization of internal-use software costs. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures.

    Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact upon our reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in our business and an important part of the compensation provided to our employees.

    Other Metrics

    ARR. ARR is defined as the annual value of all recurring revenue related to contracts in place at the end of the period. ARR should be viewed independently of revenue and deferred revenue as ARR is an operating metric and is not intended to be combined with or replace these items. ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates, and does not include revenue reported as professional services revenue in our consolidated statement of operations.

    Number of Customers. We define a customer as any entity that has an active Rapid7 recurring revenue contract as of the specified measurement date, excluding InsightOps and Logentries only customers with a contract value of less than $2,400 per year.

    ARR per Customer. We define ARR per customer as ARR divided by the number of customers at the end of the period.

    Cautionary Language Concerning Forward-Looking Statements

    This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the statements regarding our financial guidance for the second quarter and full-year 2025, and the assumptions underlying such guidance. Our use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. The events described in our forward-looking statements are subject to a number of risks and uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Risks that could cause or contribute to such differences include, but are not limited to, growing macroeconomic uncertainty, unstable market and economic conditions, fluctuations in our quarterly results, our ability to successfully grow our sales of our cloud-based solutions, including through the shift to a consolidated platform sales approach, effectiveness of our restructuring plan that was completed during fiscal year 2024, failure to meet our publicly announced guidance or other expectations about our business, our ability to sustain our revenue growth rate, the ability of our products and professional services to correctly detect vulnerabilities, renewal of our customer’s subscriptions, competition in the markets in which we operate, market growth, our ability to innovate and manage our growth, our sales cycles, our ability to integrate acquired companies, exposure to greater than anticipated tax liabilities, and our ability to operate in compliance with applicable laws as well as other risks and uncertainties that could affect our business and results described in our filings with the Securities and Exchange Commission (the “SEC”), including our most recent Annual Report on Form 10-K filed with the SEC on February 28, 2025, particularly in the section entitled “Item 1.A Risk Factors,” and in the subsequent reports that we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed in any forward-looking statements we may make. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

    Investor contact:

    Elizabeth Chwalk
    Vice President, Investor Relations
    investors@rapid7.com
    (617) 865-4277

    Press contact:

    Alice Randall
    Director, Global Corporate Communications
    press@rapid7.com
    (214) 693-4727

     
    RAPID7, INC.
    Consolidated Balance Sheets (Unaudited)
    (in thousands)
             
        March 31, 2025   December 31, 2024
    Assets        
    Current assets:        
    Cash and cash equivalents   $ 291,462     $ 334,686  
    Short-term investments     202,011       187,025  
    Accounts receivable, net     140,541       168,242  
    Deferred contract acquisition and fulfillment costs, current portion     50,667       52,134  
    Prepaid expenses and other current assets     47,964       44,024  
    Total current assets     732,645       786,111  
    Long-term investments     99,136       37,274  
    Property and equipment, net     31,659       32,245  
    Operating lease right-of-use assets     46,404       48,877  
    Deferred contract acquisition and fulfillment costs, non-current portion     69,843       73,672  
    Goodwill     575,268       575,268  
    Intangible assets, net     79,763       85,719  
    Other assets     10,092       12,868  
    Total assets   $ 1,644,810     $ 1,652,034  
    Liabilities and Stockholders’ Equity        
    Current liabilities:        
    Accounts payable   $ 12,318     $ 18,908  
    Accrued expenses and other current liabilities     69,458       88,802  
    Convertible senior notes, current portion, net     45,967       45,895  
    Operating lease liabilities, current portion     13,614       15,493  
    Deferred revenue, current portion     447,798       461,118  
    Total current liabilities     589,155       630,216  
    Convertible senior notes, non-current portion, net     889,303       888,356  
    Operating lease liabilities, non-current portion     65,484       68,430  
    Deferred revenue, non-current portion     27,524       27,078  
    Other long-term liabilities     20,622       20,243  
    Total liabilities     1,592,088       1,634,323  
    Stockholders’ equity:        
    Common stock   $ 642     $ 635  
    Treasury stock     (4,765 )     (4,765 )
    Additional paid-in-capital     1,042,355       1,011,080  
    Accumulated other comprehensive (loss) income     419       (1,205 )
    Accumulated deficit     (985,929 )     (988,034 )
    Total stockholders’ equity     52,722       17,711  
    Total liabilities and stockholders’ equity   $ 1,644,810     $ 1,652,034  
                     

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Consolidated Statements of Operations (Unaudited)
    (in thousands, except share and per share data)
       
      Three Months Ended March 31,
      2025   2024
    Revenue:      
    Product subscriptions $ 203,935     $ 196,918  
    Professional services   6,318       8,183  
    Total revenue   210,253       205,101  
    Cost of revenue:      
    Product subscriptions   54,368       54,734  
    Professional services   5,112       6,260  
    Total cost of revenue   59,480       60,994  
    Total gross profit   150,773       144,107  
    Operating expenses:      
    Research and development   47,888       41,368  
    Sales and marketing   79,400       73,095  
    General and administrative   23,586       19,928  
    Total operating expenses   150,874       134,391  
    (Loss) income from operations   (101 )     9,716  
    Other income (expense), net:      
    Interest income   5,758       4,720  
    Interest expense   (2,654 )     (2,670 )
    Other income (expense), net   1,802       (1,435 )
    Income before income taxes   4,805       10,331  
    Provision for income taxes   2,700       8,925  
    Net income $ 2,105     $ 1,406  
    Net income per share, basic $ 0.03     $ 0.02  
    Net income per share, diluted (1) $ 0.03     $ 0.02  
    Weighted-average common shares outstanding, basic   63,835,945       61,907,808  
    Weighted-average common shares outstanding, diluted   64,224,415       74,021,704  
                   

    (1) We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive. On an if-converted basis, for the three months ended March 31, 2025 and 2024, the 2025, 2027 and 2029 Notes were anti-dilutive.

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Consolidated Statements of Cash Flows (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    Cash flows from operating activities:      
    Net income $ 2,105     $ 1,406  
    Adjustments to reconcile net income to net cash provided by operating activities:      
    Depreciation and amortization   11,665       11,348  
    Amortization of debt issuance costs   1,019       1,053  
    Stock-based compensation expense   27,151       25,745  
    Deferred income taxes         1,840  
    Other   (1,153 )     (203 )
    Changes in assets and liabilities:      
    Accounts receivable   27,668       39,529  
    Deferred contract acquisition and fulfillment costs   5,295       (679 )
    Prepaid expenses and other assets   (1,995 )     (1,223 )
    Accounts payable   (6,555 )     (4,190 )
    Accrued expenses   (20,325 )     (24,890 )
    Deferred revenue   (12,874 )     (21,186 )
    Other liabilities   (2,244 )     2,520  
    Net cash provided by operating activities   29,757       31,070  
    Cash flows from investing activities:      
    Purchases of property and equipment   (1,361 )     (620 )
    Capitalization of internal-use software   (3,719 )     (2,916 )
    Purchases of investments   (144,461 )     (93,158 )
    Sales and maturities of investments   69,000       55,000  
    Other investing activities   1,328        
    Net cash used in investing activities   (79,213 )     (41,694 )
    Cash flows from financing activities:      
    Taxes paid related to net share settlement of equity awards   (1,303 )     (1,764 )
    Proceeds from employee stock purchase plan   4,446       5,046  
    Proceeds from stock option exercises   1,589       1,080  
    Net cash provided by financing activities   4,732       4,362  
    Effect of exchange rate changes on cash ,cash equivalents and restricted cash   1,334       (1,493 )
    Net decrease in cash, cash equivalents and restricted cash   (43,390 )     (7,755 )
    Cash, cash equivalents and restricted cash, beginning of period $ 342,101     $ 214,130  
    Cash, cash equivalents and restricted cash, end of period $ 298,711     $ 206,375  
    Supplemental cash flow information:      
    Cash paid for interest on convertible senior notes   1,571       2,698  
    Cash paid for income taxes, net of refunds   992       2,352  
    Reconciliation of cash, cash equivalents and restricted cash:      
    Cash and cash equivalents $ 291,462     $ 198,716  
    Restricted cash included in prepaid expenses and other current assets and other assets   7,249       7,659  
    Total cash, cash equivalents and restricted cash $ 298,711     $ 206,375  
                   

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    GAAP to Non-GAAP Reconciliation (Unaudited)
    (in thousands, except share and per share data)
       
      Three Months Ended March 31,
      2025   2024
    GAAP gross profit $ 150,773     $ 144,107  
    Add: Stock-based compensation expense1   2,264       2,671  
    Add: Amortization of acquired intangible assets2   4,423       4,317  
    Non-GAAP gross profit $ 157,460     $ 151,095  
    Non-GAAP gross margin   74.9 %     73.7 %
           
    GAAP gross profit – Product subscriptions $ 149,567     $ 142,184  
    Add: Stock-based compensation expense   1,731       2,298  
    Add: Amortization of acquired intangible assets   4,423       4,317  
    Non-GAAP gross profit – Product subscriptions $ 155,721     $ 148,799  
    Non-GAAP gross margin – Product subscriptions   76.4 %     75.6 %
           
    GAAP gross profit – Professional services $ 1,206     $ 1,923  
    Add: Stock-based compensation expense   533       373  
    Non-GAAP gross profit – Professional services $ 1,739     $ 2,296  
    Non-GAAP gross margin – Professional services   27.5 %     28.1 %
           
    GAAP (loss) income from operations $ (101 )   $ 9,716  
    Add: Stock-based compensation expense1   27,151       25,745  
    Add: Amortization of acquired intangible assets2   5,120       5,014  
    Add: Acquisition-related expenses3   183        
    Add: Restructuring expense         (190 )
    Non-GAAP income from operations $ 32,353     $ 40,285  
           
    GAAP net income $ 2,105     $ 1,406  
    Add: Stock-based compensation expense1   27,151       25,745  
    Add: Amortization of acquired intangible assets2   5,120       5,014  
    Add: Amortization of debt issuance costs   1,019       1,053  
    Add: Acquisition-related expenses3   183        
    Add: Restructuring expense4         (190 )
    Add: Discrete tax items5         6,360  
    Non-GAAP net income $ 35,578     $ 39,388  
    Add: Interest expense of convertible senior notes6   1,571       1,571  
    Numerator for non-GAAP earnings per share, diluted calculation $ 37,149     $ 40,959  
           
    Weighted average shares used in GAAP earnings per share calculation, basic   63,835,945       61,907,808  
    Dilutive effect of convertible senior notes6   11,183,611       11,183,611  
           
    Dilutive effect of employee equity incentive plans7   388,471       930,195  
    Weighted average shares used in non-GAAP earnings per share calculation, diluted   75,408,027       74,021,614  
           
    Non-GAAP net income per share:      
    Basic $ 0.56     $ 0.64  
    Diluted $ 0.49     $ 0.55  
           
    Includes stock-based compensation expense as follows:      
    Cost of revenue $ 2,264     $ 2,671  
    Research and development   10,386       7,944  
    Sales and marketing   7,241       7,137  
    General and administrative   7,260       7,993  
           
    Includes amortization of acquired intangible assets as follows:      
    Cost of revenue $ 4,423     $ 4,317  
    Sales and marketing   652       652  
    General and administrative   45       45  
           
    Includes acquisition-related expenses as follows:      
    General and administrative $ 183     $  
           
    For the three months ended March 31, 2024 restructuring expense was included within general and administrative expense in our consolidated statements of operations.
           
    Includes discrete tax items as follows:
    Provision for income taxes $     $ 6,360  
           
    We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive.
           
    We use the treasury method to compute the dilutive effect of employee equity incentive plan awards.
           

    Note: Certain prior periods reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Reconciliation of Net Income (Loss) to Adjusted EBITDA (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    GAAP net income $ 2,105     $ 1,406  
    Interest income   (5,758 )     (4,720 )
    Interest expense   2,654       2,670  
    Other (income) expense, net   (1,802 )     1,435  
    Provision for (benefit from) income taxes   2,700       8,925  
    Depreciation expense   2,791       2,908  
    Amortization of intangible assets   8,874       8,440  
    Stock-based compensation expense   27,151       25,745  
    Acquisition-related expenses   183        
    Restructuring expense         (190 )
    Adjusted EBITDA $ 38,898     $ 46,619  
                   

    Note: Certain prior period reflect immaterial corrections. Refer to Note 16, Immaterial Correction of an Error, in the notes to our Consolidated Financial Statements for further information.

     
    RAPID7, INC.
    Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited)
    (in thousands)
       
      Three Months Ended March 31,
      2025   2024
    Net cash provided by operating activities $ 29,757     $ 31,070  
    Less: Purchases of property and equipment   (1,361 )     (620 )
    Less: Capitalized internal-use software costs   (3,719 )     (2,916 )
    Free cash flow $ 24,677     $ 27,534  
                   
     
    Second Quarter and Full-Year 2025 Guidance
    GAAP to Non-GAAP Reconciliation
    (in millions, except per share data)
           
      Second Quarter 2025   Full-Year 2025
    Reconciliation of GAAP income from operations to non-GAAP income from operations:              
    Anticipated GAAP loss from operations $ (2 ) to $     $ (11 ) to $ (1 )
    Add: Anticipated stock-based compensation expense   27   to   27       116   to   116  
    Add: Anticipated amortization of acquired intangible assets   5   to   5       20   to   20  
    Anticipated non-GAAP income from operations $ 30   to $ 32     $ 125   to $ 135  
                   
    Reconciliation of GAAP net income to non-GAAP net income:              
    Anticipated GAAP net loss $ (2 ) to $     $ (9 ) to $ 1  
    Add: Anticipated stock-based compensation expense   27   to   27       116   to   116  
    Add: Anticipated amortization of acquired intangible assets   5   to   5       20   to   20  
    Add: Anticipated amortization of debt issuance costs   1   to   1       4   to   4  
    Anticipated non-GAAP net income $ 31   to $ 33     $ 131   to $ 141  
    Add: Anticipated interest expense on convertible senior notes   1.4   to   1.4       5.6   to   5.6  
    Numerator for non-GAAP earnings per share calculation $ 32.4   to $ 34.4     $ 136.6   to $ 146.6  
                   
    Anticipated GAAP net (loss) income per share1 $ (0.03 )   $     $ (0.14 )   $ 0.02  
    Anticipated non-GAAP net income per share, diluted $ 0.43     $ 0.46     $ 1.78     $ 1.91  
                   
    Weighted average shares used in earnings per share calculation, diluted 75.3   76.7
                   
    The anticipated GAAP net loss per share is calculated using basic weighted average shares for periods in which the Company anticipated a GAAP net loss. The anticipated GAAP net income per share is calculated using GAAP diluted weighted average shares for periods in which the Company anticipated GAAP net income.
     

    The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty. As a result, the estimates shown for Anticipated GAAP loss from operations, Anticipated GAAP net loss and Anticipated GAAP net loss per share are expected to change.

       
      Full-Year 2025
    Reconciliation of net cash provided by operating activities to free cash flow:      
    Anticipated net cash provided by operating activities $ 146   to $ 156  
    Less: Anticipated purchases of property and equipment   (7 ) to   (7 )
    Less: Anticipated capitalized internal-use software costs   (14 ) to   (14 )
    Anticipated free cash flow $ 125     $ 135  
                   

    The MIL Network

  • MIL-OSI: Lantronix Appoints Sailesh Chittipeddi to Its Board of Directors

    Source: GlobeNewswire (MIL-OSI)

    IRVINE, Calif., May 12, 2025 (GLOBE NEWSWIRE) — Lantronix Inc. (NASDAQ: LTRX), a global leader of compute and connectivity for IoT solutions enabling Edge AI Intelligence, today announced that Sailesh Chittipeddi, Ph.D., has joined the Lantronix Board of Directors as an independent director, effective May 6, 2025. Following the appointment of Chittipeddi, the Lantronix Board of Directors will be comprised of five directors, four of whom are independent under applicable listing standards of the Nasdaq Stock Market.

    “We are very pleased to welcome Dr. Chittipeddi to the Lantronix Board of Directors,” said Hoshi Printer, chairman of the Board at Lantronix. “Dr. Chittipeddi is a respected subject expert in Industrial, IoT and Infrastructure businesses. He also has an extensive background in leading operations, procurement and supply chains globally.”

    Dr. Chittipeddi is currently a Venture Partner at Novo Tellus Capital Partners, a Singapore-based private equity firm, and a Board Member at Tessolve, which is headquartered in India. Most recently, he was executive vice president of Global Operations at Renesas Electronics, where he oversaw internal and external manufacturing and associated functions, including supply chain, procurement and related development.

    “Lantronix will benefit greatly from Dr. Chittipeddi’s extensive technology and broad industry expertise, including his service on boards of several global companies where he helped drive successful results,” added Saleel Awsare, CEO and president of Lantronix. “With his expertise in manufacturing, procurement, logistics and global supply chain strategy, Dr. Chittipeddi adds a valuable perspective as we navigate complex geopolitical and associated supply chain environment challenges.”

    At Renesas, Dr. Chittipeddi also served as executive vice president of its Industrial, IoT and Infrastructure Business Unit. In this capacity, he nearly doubled the revenue to more than $7 billion USD. This business unit included the microcontroller, power and analog-mixed signal businesses of former IDT, ISL and DLG acquisition companies. He joined Renesas in 2019 following its acquisition of IDT. In this capacity, he also served as the president of Renesas Electronics America as well as the CEO of its acquired IDT Division.

    Before his tenures at Renesas and IDT, Dr. Chittipeddi held numerous senior positions at other leading technology companies, including Conexant Systems, where he served as the CEO and president, as well as AT&T Bell Labs, Lucent Technologies and Agere Systems. He has also served on global public and private boards, including Sequans Communications, Tessolve (India), Avalanche Technologies (India), Steradian (India), Blu Wireless Technology (U.K.) and Peraso (Canada).

    Dr. Chittipeddi holds an MBA from the University of Texas at Austin and a Ph.D. in Physics from The Ohio State University. He holds 83 U.S. semiconductor process, package and design patents and has published more than 40 technical articles.

    About Lantronix

    Lantronix Inc. is a global leader of compute and connectivity IoT solutions that target high-growth markets, including Smart Cities, Enterprise and Transportation. Lantronix’s products and services empower companies to succeed in the growing IoT markets by delivering customizable solutions that enable AI Edge Intelligence. Lantronix’s advanced solutions include Intelligent Substations infrastructure, Infotainment systems and Video Surveillance, supplemented with advanced Out-of-Band Management (OOB) for Cloud and Edge Computing.

    For more information, visit the Lantronix website.

    ©2025 Lantronix, Inc. All rights reserved. Lantronix is a registered trademark. Other trademarks and trade names are those of their respective owners.

    Lantronix Media Contact:
    Gail Kathryn Miller
    Corporate Marketing &
    Communications Manager
    media@lantronix.com

    Lantronix Analyst and Investor Contact:
    investors@lantronix.com

    A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/d04b3fa2-b8d8-4656-adad-c8d4eb6267c4

    The MIL Network

  • MIL-OSI: OptimizeRx Reports First Quarter 2025 Financial Results and Updates Fiscal Year 2025 Guidance

    Source: GlobeNewswire (MIL-OSI)

    • Q1 revenue of $21.9 million, increasing 11% year-over-year
    • Q1 gross profit increased 9% year-over-year to $13.3 million
    • Increases full year 2025 guidance to a revenue range between $101 million and $106 million and adjusted EBITDA range between $13 million and $15 million

    WALTHAM, Mass., May 12, 2025 (GLOBE NEWSWIRE) — OptimizeRx Corp. (the “Company”) (Nasdaq: OPRX), a leading provider of healthcare technology solutions helping life sciences companies reach and engage healthcare professionals (HCPs) and patients, today reported results for the three months ended March 31, 2025. Quarterly comparisons are to the same year-ago period.

    Financial Highlights

    • Revenue in the first quarter of 2025 increased 11% to $21.9 million, as compared to $19.7 million in the same year ago period
    • Gross profit in the first quarter of 2025 increased 9% year-over-year to $13.3 million, from $12.2 million during the first quarter of 2024
    • GAAP net loss totaled $(2.2) million or $(0.12) per basic and diluted share in the first quarter of 2025, as compared to $(6.9) million or $(0.38) per basic and diluted share during the first quarter of 2024
    • Non-GAAP net income in the first quarter totaled $1.5 million or $0.08 per diluted share, as compared to Non-GAAP net loss of $(2.0) million or $(0.11) per diluted share during the first quarter of 2024 (see *Non-GAAP Measures below)
    • Adjusted EBITDA for the first quarter of 2025 increased to $1.5 million compared to $(0.3) million in the same year ago period (see *Non-GAAP Measures below)
    • Cash, cash equivalents and short-term investments totaled $16.6 million as of March 31, 2025, as compared to $13.4 million as of December 31, 2024

    Stephen L. Silvestro, OptimizeRx CEO commented, “I’m encouraged by our year-to-date performance, which has exceeded both consensus estimates and our internal expectations. The momentum we saw at the end of 2024 has carried into 2025, with year-to-date contracted revenue up more than 20% compared to the same period last year—positioning us well for a strong second half of the year. I believe this performance clearly reflects the results of our focus on operational excellence, our commitment to delighting customers, and our efforts to deepen relationships with valued business partners, all of which are driving meaningful shareholder value.

    “At the same time, we’ve already converted over 5% of our expected 2025 sales into subscription-based revenue streams. I believe this transition, combined with our improving operating leverage, puts us on a strong path toward achieving Rule of 40 performance in the coming years.

    “Given our strong performance and positive outlook, I’m pleased to announce that we are raising our full-year guidance. We now expect the revenue range to be between $101 million and $106 million, and adjusted EBITDA to be between $13 million and $15 million.”

      Rolling Twelve Months Ended March 31,
    Key Performance Indicators (KPIs)**  2025     2024 
      (in thousands, except percentages)
    Average revenue per top 20 pharmaceutical manufacturer $ 2,960     $ 2,592  
    Percent of total revenue attributable to top 20 pharmaceutical manufacturers   63 %     66 %
    Net revenue retention   114 %     116 %
    Revenue per average full-time employee $ 710     $ 641  

    2025 Financial Outlook

    The Company is increasing its 2025 guidance and expects revenue to be between $101 million and $106 million with Adjusted EBITDA to be between $13 million and $15 million.

    Conference Call

    Individual Meeting Invitation

    In an effort to increase relations with institutional investors, OptimizeRx management has dedicated time to hosting individual meetings with portfolio managers and analysts. If you are interested in scheduling a meeting with OptimizeRx management, please contact: adsilva@optimizerx.com or shalper@lifesciadvisors.com.

    *Non-GAAP Measures

    In addition to the financial measures prepared in accordance with generally accepted accounting principles (GAAP), this earnings release also contains non-GAAP financial measures. The reasons why we believe these measures provide useful information to investors and, for historical periods, a reconciliation of these measures to the most directly comparable GAAP measures are included in the supplemental tables that follow.

    Although the Company provides guidance for Adjusted EBITDA, a non-GAAP financial measure, it is not able to provide guidance to the most directly comparable GAAP measure. Reconciliations for forward-looking figures would require unreasonable effort at this time because of the uncertainty and variability of the nature and amount of certain components of various necessary GAAP components, including, for example, those related to compensation, acquisition expenses, other income, amortization or others that may arise during the year, and the Company’s management believes such reconciliations would imply a degree of precision that would be confusing or misleading to investors. For the same reasons, the Company is unable to address the probable significance of the unavailable information.

    **Definition of Key Performance Indicators

    Top 20 pharmaceutical manufacturers: We have updated the definition of “top 20 pharmaceutical manufacturers” in our key performance indicators to be based upon Fierce Pharma’s most updated list of “The top 20 pharma companies by 2024 revenue”. We previously used “The top 20 pharma companies by 2023 revenue”. As a result of this change, prior periods have been restated for comparative purposes.

    Net revenue retention: Net revenue retention is a comparison of revenue generated from all clients in the previous period to total revenue generated from the same clients in the following year (i.e., excludes new client relationships for the most recent year).

    Revenue per average full-time employee: We define revenue per average full-time employee (FTE) as total revenue over the last 12 months (LTM) divided by the average number of employees over the LTM, which is calculated by taking our total number of FTEs at the end of the prior year period by our total FTE headcount at the end of the most recent period.

    About OptimizeRx

    OptimizeRx is a leading healthcare technology company that’s redefining how life science brands connect with patients and healthcare providers. Our platform combines innovative AI-driven tools like the Dynamic Audience Activation Platform (DAAP) and Micro-Neighborhood Targeting (MNT) to deliver timely, relevant, and hyper-local engagement. By bridging the gap between HCP and DTC strategies, we empower brands to create synchronized marketing solutions that drive faster treatment decisions and improved patient outcomes.

    Our commitment to privacy-safe, patient-centric technology ensures that every interaction is designed to make a meaningful impact, delivering life-changing therapies to the right patients at the right time. Headquartered in Waltham, Massachusetts, OptimizeRx partners with some of the world’s leading pharmaceutical and life sciences companies to transform the healthcare landscape and create a healthier future for all.

    For more information, follow the Company on Twitter, LinkedIn or visit www.optimizerx.com.  

    Important Cautions Regarding Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Words such as “anticipates”, “believes”, “estimates”, “expects”, “forecasts”, “intends”, “plans”, “projects”, “targets”, “designed”, “could”, “may”, “should”, “will” or other similar words and expressions are intended to identify these forward-looking statements. All statements that reflect the Company’s expectations, assumptions, projections, beliefs or opinions about the future, other than statements of historical fact, are forward-looking statements, including, without limitation, statements relating to the Company’s future performance, expected revenues, expected Adjusted EBITDA, plans to grow shareholder value creation, plans to continue the Company’s growth and transformation, plans to position the Company to become a “Rule of 40” company, plans for forging stronger relationships with valued business partners, and other statements relating to future performance, plans, and expectations. These forward-looking statements are based on the Company’s current expectations and involve assumptions regarding the Company’s business, the economy, and other future conditions that may never materialize or may prove to be incorrect. Forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted, or quantified. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of various risks and uncertainties including, but not limited to, the effect of government regulation, seasonal trends, dependence on a concentrated group of customers, cybersecurity incidents that could disrupt operations, the ability to keep pace with growing and evolving technology, the ability to maintain contracts with electronic prescription platforms and electronic health records networks, competition, and other factors discussed in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2024, its subsequent Quarterly Reports on Form 10-Q, and in other filings the Company has made and may make with the Securities and Exchange Commission in the future. One should not place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. The Company undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made, except as may be required by law.

    OptimizeRx Contact
    Andy D’Silva, SVP Corporate Finance
    adsilva@optimizerx.com

    Investor Relations Contact
    Steven Halper
    LifeSci Advisors, LLC
    shalper@lifesciadvisors.com

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (in thousands, except share and per share data)

      March 31,
    2025
      December 31,
    2024
    ASSETS (unaudited)    
    Current assets      
    Cash and cash equivalents $ 16,573     $ 13,380  
    Accounts receivable, net of allowance for credit losses of $335 at March 31, 2025 and December 31, 2024   32,720       38,212  
    Taxes receivable   113        
    Prepaid expenses and other   2,305       2,379  
    Total current assets   51,711       53,971  
    Property and equipment, net   150       150  
    Other assets      
    Goodwill   70,869       70,869  
    Patent rights, net   5,349       5,517  
    Technology assets, net   7,931       8,180  
    Tradename and customer relationships, net   31,226       31,819  
    Operating lease right of use assets   303       366  
    Security deposits and other assets   229       296  
    Total other assets   115,907       117,047  
    TOTAL ASSETS $ 167,768     $ 171,168  
           
    LIABILITIES AND STOCKHOLDERS’ EQUITY      
    Current liabilities      
    Current portion of long-term debt $ 3,300     $ 2,000  
    Accounts payable   3,381       2,156  
    Accrued expenses   9,277       8,486  
    Revenue share payable   1,743       5,053  
    Taxes payable         318  
    Current portion of lease liabilities   139       168  
    Deferred revenue   511       473  
    Total current liabilities   18,351       18,654  
    Non-current liabilities      
    Long-term debt, net   29,190       30,816  
    Lease liabilities, net of current portion   171       209  
    Deferred tax liabilities, net   3,786       4,491  
    Total liabilities   51,498       54,170  
           
    Stockholders’ equity      
    Preferred stock, $0.001 par value, 10,000,000 shares authorized, none issued and outstanding at March 31, 2025 or December 31, 2024          
    Common stock, $0.001 par value, 166,666,667 shares authorized, 20,234,186 and 20,194,697 shares issued at March 31, 2025 and December 31, 2024, respectively   20       20  
    Treasury stock, $0.001 par value, (1,741,397) shares held at March 31, 2025 and December 31, 2024   (2 )     (2 )
    Additional paid-in-capital   202,819       201,348  
    Accumulated deficit   (86,567 )     (84,368 )
    Total stockholders’ equity   116,270       116,998  
    TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 167,768     $ 171,168  
     

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except share and per share data, unaudited)

      For the Three Months Ended
    March 31,
       2025     2024 
           
    Net revenue $ 21,928     $ 19,690  
    Cost of revenues, exclusive of depreciation and amortization presented separately below   8,584       7,486  
    Gross profit   13,344       12,204  
           
    Operating expenses      
    General and administrative expenses   14,364       16,166  
    Depreciation and amortization   1,094       1,067  
    Total operating expenses   15,458       17,233  
    Loss from operations   (2,114 )     (5,029 )
    Other income (expense)      
    Interest expense   (1,297 )     (1,546 )
    Other income   39        
    Interest income   88       20  
    Total other expense, net   (1,170 )     (1,526 )
    Loss before provision for income taxes   (3,284 )     (6,555 )
    Income tax benefit (expense)   1,085       (344 )
    Net loss $ (2,199 )   $ (6,899 )
    Weighted average number of shares outstanding – basic   18,470,808       18,170,108  
    Weighted average number of shares outstanding – diluted   18,470,808       18,170,108  
    Loss per share – basic $ (0.12 )   $ (0.38 )
    Loss per share – diluted $ (0.12 )   $ (0.38 )
     

    OPTIMIZERX CORPORATION
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands, unaudited)

      For the Three Months Ended
    March 31,
      2025   2024
    CASH FLOWS FROM OPERATING ACTIVITIES:      
    Net loss $ (2,199 )   $ (6,899 )
    Adjustments to reconcile net loss to net cash provided by operating activities:      
    Depreciation and amortization   1,094       1,067  
    Stock-based compensation   1,558       3,024  
    Bad debt reserve         132  
    Amortization of debt issuance costs   174       182  
    Changes in:      
    Accounts receivable   5,492       6,373  
    Prepaid expenses and other assets   74       800  
    Accounts payable   1,225       (562 )
    Revenue share payable   (3,310 )     (2,692 )
    Accrued expenses and other liabilities   854       (362 )
    Taxes receivable and payable   (431 )     323  
    Deferred tax liabilities   (705 )      
    Deferred revenue   38       732  
    NET CASH PROVIDED BY OPERATING ACTIVITIES   3,864       2,118  
           
    CASH FLOWS USED IN INVESTING ACTIVITIES:      
    Purchase of property and equipment   (27 )     (32 )
    Capitalized software development costs   (57 )     (121 )
    NET CASH USED IN INVESTING ACTIVITIES   (84 )     (153 )
           
    CASH FLOWS USED IN FINANCING ACTIVITIES:      
    Cash paid for employee withholding taxes related to the vesting of restricted stock units   (87 )     (140 )
    Repayment of long-term debt   (500 )     (500 )
    NET CASH USED IN FINANCING ACTIVITIES   (587 )     (640 )
    NET INCREASE IN CASH AND CASH EQUIVALENTS   3,193       1,325  
    CASH AND CASH EQUIVALENTS – BEGINNING OF PERIOD   13,380       13,852  
    CASH AND CASH EQUIVALENTS – END OF PERIOD $ 16,573     $ 15,177  
           
    SUPPLEMENTAL CASH FLOW INFORMATION:      
    Cash paid for interest $ 1,121     $ 1,350  
    Cash paid for income taxes $     $ 21  

    OPTIMIZERX CORPORATION
    RECONCILIATION of GAAP to NON-GAAP FINANCIAL MEASURES
    (in thousands, except share and per share data, unaudited)

    This earnings release includes certain financial measures not derived in accordance with generally accepted accounting principles (GAAP). These non-GAAP financial measures are measures of performance not defined by accounting principles generally accepted in the United States and should be considered in addition to, not in lieu of, GAAP reported measures. Additionally, these non-GAAP measures may not be comparable to similarly titled measures reported by other companies. However, management believes that presenting certain non-GAAP financial measures provides additional information to facilitate comparison of the Company’s historical operating results and trends in its underlying operating results and provides transparency on how the Company evaluates its business. Management uses these non-GAAP financial measures in making financial, operating and planning decisions and in evaluating the Company’s performance. Management believes that financial information excluding certain items that are not considered to reflect the Company’s ongoing operating results, such as those listed below, improves the comparability of year-to-year results. Consequently, management believes that investors may be able to better understand the Company’s operating results excluding these items. Non-GAAP financial measures may reflect adjustments for items such as asset impairment charges, amortization, stock-based compensation, acquisition expenses, severance, shareholder activist related fees, CEO search fees, other income, as well as other items that management believes are not related to the Company’s ongoing performance.

      Three Months Ended March 31,
       2025     2024 
    Net loss $         (2,199 )   $         (6,899 )
    Depreciation and amortization           1,094               1,067  
    Stock-based compensation           1,558               3,024  
    Severance expenses           275               419  
    Shareholder activist related fees           451               —  
    CEO search fees           225               —  
    Other income           (39 )             —  
    Amortization of debt issuance costs           174               182  
    Acquisition expenses           —               243  
    Non-GAAP net income (loss) $         1,539     $         (1,964 )
           
    Non-GAAP net income (loss) per share      
    Diluted $         0.08     $         (0.11 )
    Weighted average shares outstanding:      
    Diluted   18,579,012       18,170,108  
      Three Months Ended March 31,
      2025   2024
    Net loss $ (2,199 )   $ (6,899 )
    Depreciation and amortization   1,094       1,067  
    Income tax (benefit) expense   (1,085 )     344  
    Stock-based compensation   1,558       3,024  
    Severance expenses   275       419  
    Acquisition expenses         243  
    Shareholder activist related fees   451        
    CEO search fees   225        
    Other income   (39 )      
    Interest expense, net   1,209       1,526  
    Adjusted EBITDA $ 1,489     $ (276 )

    The MIL Network

  • MIL-OSI: Amplify Energy Announces First Quarter 2025 Results, Beta Development Update and Updated Full-Year 2025 Guidance

    Source: GlobeNewswire (MIL-OSI)

    HOUSTON, May 12, 2025 (GLOBE NEWSWIRE) — Amplify Energy Corp. (NYSE: AMPY) (“Amplify,” the “Company,” “us,” or “our”) announced today its operating and financial results for the first quarter of 2025 and updated full-year 2025 guidance for the Company.

    Beta Development Program Update

    • Amplify initiated a development drilling program in the prolific Beta oilfield in 2024 to demonstrate the significant upside potential of the asset and generate strong incremental cash flows for the Company, with results to date proving out the viability and long-term potential of the program
    • Completed the C54 well in mid-April 2025
      • Drilled well utilizing lessons learned from 2024 program including the implementation of a managed pressure drilling system
      • IP20 was approximately 800 Bopd, which has been the strongest initial well performance in the program
      • With the C54 online, the three wells completed in the D-Sand (our primary target formation) are all projected to have greater than 90% IRR at $60/bbl oil prices
    • Completed the C48 well in mid-February 2025 as the first C-Sand completion
      • Initially planned as a D-Sand completion, but due to drilling complications elected to complete the shallower C-Sand
      • Current production rate of approximately 100 BOPD
      • Well exhibits lower oil gravities and reservoir pressures than the D-Sand completions
      • Future injection support in the area to increase reservoir pressure and deliverability is expected to prove the C-Sand as a viable future target zone
    • With the recent completions of the C48 and C54, the field now has four new development wells online, which, after offsetting the asset’s base decline, have increased Beta production by approximately 35% since early 2024
    • Based on Beta development success, at year-end 2024 Amplify had 25 SEC Proved Undeveloped (“PUD”) locations (21 D-Sand locations) with approximately $144 million in PV-10 value1
      • D-Sand completions to date are significantly outperforming the type curve utilized in SEC PUD value/reserves indicating material upside above the current valuation estimate
      • Substantial future development remains at Beta beyond the current SEC PUD locations which are based on conservative volumetric and recovery factor assumptions

    First Quarter Highlights

    • During the first quarter of 2025, the Company:
      • Achieved average total production of 17.9 MBoepd
      • Generated net cash provided by operating activities of $25.5 million and a net loss of $5.9 million
      • Delivered Adjusted EBITDA of $19.4 million and Adjusted Net Income of $3.8 million
      • Generated $6.3 million in net proceeds from the sale of undeveloped Haynesville acreage in East Texas
        • In May 2025, sold additional Haynesville interests generating $1.5 million in proceeds
      • Generated $0.9 million of Adjusted EBITDA at Magnify Energy Services, Amplify’s wholly owned subsidiary (“Magnify”)
      • As of March 31, 2025, Amplify had $125.0 million outstanding under the revolving credit facility
        • Net debt to Last Twelve Months (“LTM”) Adjusted EBITDA of 1.3x2

    (1)   2024 Year End reserves are evaluated at flat pricing: (NYMEX WTI, HH) – $65.00, $4.00

    (2)   Net debt as of March 31, 2025, consisting of $125 MM outstanding under its revolving credit facility with ~$0 MM of cash and cash equivalents, and LTM Adjusted EBITDA as of the first quarter of 2025.

    Martyn Willsher, Amplify’s President and Chief Executive Officer, commented, “Amplify’s strong first quarter operating and financial results continue to demonstrate the significant value derived from the Company’s portfolio of assets. At Beta, we brought online two wells this year, which strengthen our conviction about the prolific untapped value that remains in the reservoir. In East Texas and the Eagle Ford, we anticipate our non-operated development projects will begin producing in the second quarter, with improved natural gas prices driving strong economics for our East Texas wells. Also, in East Texas, we recently monetized a portion of our undeveloped acreage with Haynesville rights in two separate transactions for net proceeds of $7.8 million dollars, while retaining an interest in over 30 gross locations to realize upside value in future periods.”

    Mr. Willsher continued, “In light of recent market volatility and a material reduction in oil prices, we conducted a comprehensive review of our remaining uncommitted 2025 capital budget and have elected to temporarily defer three development projects at Beta resulting in capital savings of approximately $15 million in 2025. While our Beta development projects have strong economics at current oil prices, we have flexibility on the timing of these projects and are committed to maintaining strong free cash flow and a healthy balance sheet for our investors. Our diversified portfolio of mature, low-decline assets and robust hedge book protect our cash flow profile during commodity downturns, allowing us the flexibility to scale up or down investments in either oil or gas projects depending on market conditions.”

    Mr. Willsher concluded, “Going forward, Amplify intends to focus on prudent management of its existing asset base to maximize free cash flow and is conducting a thorough review of additional operating and overhead cost-saving opportunities. The Company will also continue to evaluate portfolio optimization opportunities, which could enable us to accelerate Beta development.”

    Key Financial Results

    During the first quarter of 2025, the Company reported a net loss of approximately $5.9 million. The net loss was primarily attributable to a non-cash unrealized loss on commodity derivatives during the period partially offset by a gain on the sale of East Texas properties. Excluding the impact of the non-cash unrealized loss on commodity derivatives, the East Texas divestiture, and additional other one-time impacts, Amplify generated Adjusted Net Income of $3.8 million in the first quarter of 2025.

    First quarter 2025 Adjusted EBITDA was $19.4 million, a decrease of approximately $2.4 million from the prior quarter. The decrease was primarily due to higher lease operating expense and general and administrative expense that are typically higher in the first quarter offset by stronger gas price realizations compared to the prior quarter.

    Free cash flow was negative $7.2 million for the first quarter, which was in-line with expectations, due to planned capital investments.

         
         
         
      First Quarter Fourth Quarter
    $ in millions  2025   2024 
    Net income (loss) ($5.9 ) ($7.4 )
    Net cash provided by operating activities $25.5   $12.5  
    Average daily production (MBoe/d) 17.9   18.5  
    Total revenues excluding hedges $72.1   $69.0  
    Adjusted EBITDA (a non-GAAP financial measure) $19.4   $21.8  
    Adjusted net income (loss), (a non-GAAP financial measure) $3.8   $5.1  
    Total capital $23.1   $15.3  
    Free Cash Flow (a non-GAAP financial measure) ($7.2 ) $2.9  
         

    Revolving Credit Facility and Liquidity Update

    As of March 31, 2025, Amplify had total debt of $125 million under its revolving credit facility. Net debt to LTM Adjusted EBITDA was 1.3x (net debt as of March 31, 2025). The borrowing base is redetermined on a semi-annual basis with the next redetermination expected in the second quarter of 2025.

    Corporate Production and Pricing

    During the first quarter of 2025, average daily production was approximately 17.9 Mboepd, a decrease of 0.6 Mboepd from the prior quarter. The decrease in production was driven by natural gas and NGL volumes affected by a gas imbalance adjustment in East Texas and adverse weather in Oklahoma, causing widespread power outages. These temporary production issues were factored into the production guidance previously presented for 2025.

    The Company’s product mix for the quarter was 46% crude oil, 16% NGLs, and 38% natural gas.

        Three Months   Three Months
        Ended   Ended
        March 31, 2025   December 31, 2024
             
    Production volumes – MBOE:      
      Bairoil 280     293  
      Beta 315     308  
      Oklahoma 393     436  
      East Texas / North Louisiana 570     609  
      Eagle Ford (Non-op) 49     60  
      Total – MBoe 1,607     1,706  
      Total – MBoe/d 17.9     18.5  
      % – Liquids 62 %   62 %
             

    Total oil, natural gas and NGL revenues for the first quarter of 2025 were approximately $70.3 million, before the impact of derivatives. The Company realized a net gain on commodity derivatives of $0.5 million during the first quarter. Oil, natural gas and NGL revenues, net of realized hedges, decreased $0.4 million for the first quarter compared to the prior quarter.

    The following table sets forth information regarding average realized sales prices for the periods indicated:

      Crude Oil ($/Bbl) NGLs ($/Bbl) Natural Gas ($/Mcf)
      Three Months
    Ended
    March 31,
    2025
      Three Months
    Ended
    December 31,
    2024
      Three Months
    Ended
    March 31,
    2025
      Three Months
    Ended
    December 31,
    2024
      Three Months
    Ended
    March 31,
    2025
      Three Months
    Ended
    December 31,
    2024
                           
    Average sales price exclusive of realized derivatives and certain deductions from revenue $ 67.82   $ 66.82   $ 25.24     $ 23.46     $ 3.87   $ 2.52  
    Realized derivatives   0.49     1.43                 0.04     0.76  
                           
    Average sales price with realized derivatives exclusive of certain deductions from revenue $ 68.31   $ 68.25   $ 25.24     $ 23.46     $ 3.91   $ 3.28  
    Certain deductions from revenue           (1.78 )     (1.37 )     0.02     (0.01 )
                           
    Average sales price inclusive of realized derivatives and certain deductions from revenue $ 68.31   $ 68.25   $ 23.46     $ 22.09     $ 3.93   $ 3.27  
                           

    Costs and Expenses

    Lease operating expenses in the first quarter of 2025 were approximately $37.4 million, or $23.28 per Boe, a $2.3 million increase compared to the prior quarter and in-line with internal projections. Lease operating expenses are expected to decrease in the second half of 2025 after cost savings projects are completed in Bairoil, and fewer expense workovers are conducted later in the year. Lease operating expenses do not reflect $0.9 million of income generated by Magnify in the first quarter.

    Severance and ad valorem taxes in the first quarter were approximately $4.4 million, a decrease of $1.0 million compared to $5.4 million in the prior quarter. Lower production taxes were primarily due to lower production and a one-time benefit from reversing a prior accrual for waste emissions charges. Severance and ad valorem taxes as a percentage of revenue were approximately 6.2% in the first quarter. The Company anticipates that taxes as a percentage of revenue will remain within its previously announced guidance range for 2025.

    Amplify incurred $4.3 million, or $2.67 per Boe, of gathering, processing and transportation expenses in the first quarter, compared to $4.5 million, or $2.62 per Boe, in the prior quarter.

    Cash G&A expenses in the first quarter were $7.3 million, down 7% compared to the first quarter of 2024, and in-line with expectations. The Company anticipates that quarterly cash G&A expenses will be significantly lower throughout the remainder of the year primarily due to annual year-end processes that impact various cost drivers in the first quarter. The Company expects costs to be in line with our previously announced guidance range.

    Depreciation, depletion and amortization expense in the first quarter totaled $8.5 million, or $5.29 per Boe, compared to $8.4 million, or $4.93 per Boe, in the prior quarter.

    Net interest expense was $3.5 million in the first quarter, a decrease of $0.2 million compared to $3.7 million in the prior quarter.

    Amplify recorded minimal current income tax expense for the first quarter of 2025.

    Capital Investment Update

    Cash capital investment during the first quarter of 2025 was approximately $23.1 million. During the first quarter, the Company’s capital allocation was approximately 55% for development drilling, recompletions and facility projects at Beta, and approximately 30% for non-operated development projects in East Texas and the Eagle Ford, with the remainder distributed across the Company’s other assets.

    The following table details Amplify’s capital invested during the first quarter of 2025:

      First Quarter
      2025 Capital
      ($ MM)
    Bairoil $ 1.3
    Beta $ 12.7
    Oklahoma $ 1.4
    East Texas / North Louisiana $ 3.4
    Eagle Ford (Non-op) $ 3.9
    Magnify Energy Services $ 0.3
    Total Capital Invested $ 23.1
       

    2025 Operations & Development Plan

    Amplify has adjusted its 2025 operations and development plan for the current lower commodity price environment. The Company is electing to reduce discretionary development capital at Beta for the second half of 2025, while our previously committed non-operated projects in East Texas and the Eagle Ford are expected to be completed and brought online in the second quarter.

    Amplify’s current plan is to complete three wells at Beta in 2025, including the C48 and C54 wells, which were brought online in mid-February and mid-April, respectively. Amplify intends to drill and complete its next Beta well in the third quarter, which will be a D-Sand completion drilled in the same fault block as the recently completed C54 and the C59, which was completed in October 2024 and is still producing greater than 500 bopd. With the exceptional economics at Beta, Amplify will consider adding back development wells later this year should commodity prices improve.

    Other capital at Beta for 2025 includes $8 million to upgrade a two-mile pipeline that ships all produced fluid from platform Eureka to platform Elly, facility upgrades and capital workovers. Additional information regarding the Beta development plan can be found in the Company’s investor presentation under the investor relations section of the website.

    In East Texas, we are participating in the completion of four non-operated development projects, which we expect to be online in late second quarter. Operators in the area are taking advantage of strong natural gas prices and favorable economics, and the Company anticipates more activity in this area. For the Company’s operated assets, the team is focused on prudent management of the field, such as optimizing field compression, artificial lift enhancement, and equipment insourcing, which is expected to improve the production profile and lower lease operating costs.

    Also in East Texas, as previously announced, Amplify sold 90% of its interest in certain units with Haynesville rights in Harrison County, Texas, in addition to 11 gross operated wells, and purchased a 10% interest in adjacent acreage, generating $6.3 million in net proceeds from the sale. This transaction also established an area of mutual interest (“AMI”) with the counterparty covering 10,000 gross acres. We estimate the AMI has more than 30 potential gross drilling locations.

    In May 2025, Amplify completed a separate transaction, which monetized 90% of its interests in three additional units with Haynesville rights in Panola and Shelby Counties, finalizing a separate AMI consisting of seven total units. Amplify also retained a 10% working interest with the ability to participate in any well drilled within the boundary of the AMI. Upon closing the transaction, Amplify generated approximately $1.5 million in proceeds.

    From November 2024 to present, Amplify has generated proceeds of $9.2 million related to Haynesville acreage transactions, while retaining a 10% working interest in two newly created AMIs in the Haynesville play of East Texas.

    In the Eagle Ford, we are participating in 14 gross (0.7 net) new development wells and two gross (0.4 net) recompletion projects. These non-operated wells, with highly accretive forecasted returns, have been completed and are scheduled to come online in early May. The Company is also evaluating additional development opportunities recently offered by our partners in fields where we have interests.

    Updated Full-Year 2025 Guidance

    Based on recent reductions to crude oil prices, Amplify has decided to modify its capital plans in order to maintain positive free cash flow in 2025. As a result of these modifications, we are providing updated guidance. The following guidance is subject to the cautionary statements and limitations described under the “Forward-Looking Statements” caption at the end of this press release. Amplify’s updated 2025 guidance is based on its current expectations regarding capital investment and full-year 2025 commodity prices for crude oil of $61.75/Bbl (WTI) and natural gas of $3.60/MMBtu (Henry Hub), and on the assumption that market demand and prices for oil and natural gas will continue at levels that allow for economic production of these products. Additionally, the Company expects to invest approximately 95% of its capital in the first three quarters of the year primarily in connection with the Beta development program and for non-operated development projects in East Texas and the Eagle Ford.

    A summary of the guidance is presented below:

      March 5, 2025
      March 7, 2025
      Previous Guidance   Updated Guidance
                   
      FY 2025E   FY 2025E
                   
      Low   High   Low   High
                   
    Net Average Daily Production              
    Oil (MBbls/d) 8.5 9.4   8.3 8.9
    NGL (MBbls/d) 3.0 3.3   3.0 3.3
    Natural Gas (MMcf/d) 45.0 51.0   45.0 50.0
    Total (MBoe/d) 19.0 21.0   19.0 20.5
                   
    Commodity Price Differential / Realizations (Unhedged)              
    Oil Differential ($ / Bbl) ($3.25) ($4.25)   ($3.25) ($4.25)
    NGL Realized Price (% of WTI NYMEX) 27% 31%   27% 31%
    Natural Gas Realized Price (% of Henry Hub) 85% 92%   85% 92%
                   
    Other Revenue              
    Magnify Energy Services ($ MM) $4 $6   $4 $6
    Other ($ MM) $2 $3   $2 $3
    Total ($ MM) $6 $9   $6 $9
                   
    Gathering, Processing and Transportation Costs              
    Oil ($ / Bbl) $0.65 $0.85   $0.65 $0.85
    NGL ($ / Bbl) $2.75 $4.00   $2.75 $4.00
    Natural Gas ($ / Mcf) $0.55 $0.75   $0.55 $0.75
    Total ($ / Boe) $2.25 $2.85   $2.25 $2.85
                   
    Average Costs              
    Lease Operating ($ / Boe) $18.50 $20.50   $18.50 $20.50
    Taxes (% of Revenue) (1) 6.0% 7.0%   6.0% 7.0%
    Cash General and Administrative ($ / Boe) (2)(3) $3.40 $3.90   $3.40 $3.90
                   
    Adjusted EBITDA ($ MM) (2)(3) $100 $120   $80 $110
    Cash Interest Expense ($ MM) $12 $18   $12 $18
    Capital Investment ($ MM) $70 $80   $55 $70
    Free Cash Flow ($ MM) (2)(3) $10 $30   $10 $20
                   

    (1) Includes production, ad valorem and franchise taxes
    (2) Refer to “Use of Non-GAAP Financial Measures” for Amplify’s definition and use of cash G&A, Adjusted EBITDA and free cash flow, non-GAAP measures (cash income taxes, which are not included in free cash flow, are expected to range between $0 – $1 million for the year)
    (3) Amplify believes that a quantitative reconciliation of such forward-looking information to the most comparable financial measure calculated and presented in accordance with GAAP cannot be made available without unreasonable efforts. A reconciliation of these non-GAAP financial measures would require Amplify to predict the timing and likelihood of future transactions and other items that are difficult to accurately predict. Neither of these forward-looking measures, nor their probable significance, can be quantified with a reasonable degree of accuracy. Accordingly, a reconciliation of the most directly comparable forward-looking GAAP measures is not provided.

    Hedging

    Amplify maintains a robust hedge book to support its cash flow profile and provide downside protection in weak commodity environments. Recently, the Company added to its hedge position, further protecting future cash flows.

    Amplify executed crude oil swaps covering the first half of 2026 at a weighted average price of $62.55 per barrel and the first half of 2027 with a weighted average price of $61.93 per barrel. The Company also added natural gas swaps covering 2026 at a weighted average price of $4.12 per MMBtu, collars for the first quarter of 2026 with a weighted average floor of $4.50 per MMBtu and a weighted average ceiling of $5.73 and natural gas collars for 2027 with a weighted average floor of $3.57 per MMBtu and a weighted average ceiling of $4.58 per MMBtu.

    The following table reflects the hedged volumes under Amplify’s commodity derivative contracts and the average fixed floor and ceiling prices at which production is hedged for April 2025 through December 2027, as of May 12, 2025:

      2025   2026   2027
               
    Natural Gas Swaps:          
    Average Monthly Volume (MMBtu)   560,000     515,000     137,500
    Weighted Average Fixed Price ($) $ 3.75   $ 3.80   $ 4.01
               
    Natural Gas Collars:          
    Two-way collars          
    Average Monthly Volume (MMBtu)   500,000     517,500     437,500
    Weighted Average Ceiling Price ($) $ 3.90   $ 4.11   $ 4.21
    Weighted Average Floor Price ($) $ 3.50   $ 3.58   $ 3.56
               
    Oil Swaps:          
    Average Monthly Volume (Bbls)   141,444     125,500     30,667
    Weighted Average Fixed Price ($) $ 70.61   $ 66.40   $ 61.93
               
    Oil Collars:          
    Two-way collars          
    Average Monthly Volume (Bbls)   45,333        
    Weighted Average Ceiling Price ($) $ 80.20        
    Weighted Average Floor Price ($) $ 70.00        
               

    Amplify has posted an updated investor presentation containing additional hedging information on its website, www.amplifyenergy.com, under the Investor Relations section.

    Quarterly Report on Form 10-Q

    Amplify’s financial statements and related footnotes will be available in its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025, which Amplify expects to file with the SEC on May 12, 2025.

    About Amplify Energy

    Amplify Energy Corp. is an independent oil and natural gas company engaged in the acquisition, development, exploitation and production of oil and natural gas properties. Amplify’s operations are focused in Oklahoma, the Rockies (Bairoil), federal waters offshore Southern California (Beta), East Texas / North Louisiana, and the Eagle Ford (Non-op). For more information, visit www.amplifyenergy.com.

    Conference Call

    Amplify will host an investor teleconference tomorrow at 10 a.m. Central Time to discuss these operating and financial results. Interested parties may join the call by dialing (888) 999-3182 at least 15 minutes before the call begins and providing the Conference ID: AEC1Q25. A telephonic replay will be available for fourteen days following the call by dialing (800) 654-1563 and providing the Access Code: 52458798. A transcript and a recorded replay of the call will also be available on our website after the call.

    Forward-Looking Statements

    This press release includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements, other than statements of historical fact, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Terminology such as “may,” “will,” “would,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “estimate,” “predict,” “potential,” “pursue,” “target,” “outlook,” “continue,” the negative of such terms or other comparable terminology are intended to identify forward-looking statements. These statements include, but are not limited to, statements about the Company’s expectations of plans, goals, strategies (including measures to implement strategies), objectives and anticipated results with respect thereto. These statements address activities, events or developments that we expect or anticipate will or may occur in the future, including things such as projections of results of operations, plans for growth, goals, future capital expenditures, competitive strengths, references to future intentions and other such references. These forward-looking statements involve risks and uncertainties and other factors that could cause the Company’s actual results or financial condition to differ materially from those expressed or implied by forward-looking statements. These include risks and uncertainties relating to, among other things: the Company’s evaluation and implementation of strategic alternatives; risks related to the redetermination of the borrowing base under the Company’s revolving credit facility; the Company’s ability to satisfy debt obligations; the Company’s need to make accretive acquisitions or substantial capital expenditures to maintain its declining asset base, including the existence of unanticipated liabilities or problems relating to acquired or divested business or properties; volatility in the prices for oil, natural gas and NGLs; the Company’s ability to access funds on acceptable terms, if at all, because of the terms and conditions governing the Company’s indebtedness, including financial covenants; general political and economic conditions, globally and in the jurisdictions in which we operate, including the Russian invasion of Ukraine, and ongoing conflicts in the Middle East, trade wars and the potential destabilizing effect such conflicts may pose for the global oil and natural gas markets; expectations regarding general economic conditions, including inflation; and the impact of local, state and federal governmental regulations, including those related to climate change and hydraulic fracturing, and potential changes in these regulations. Please read the Company’s filings with the SEC, including “Risk Factors” in the Company’s Annual Report on Form 10-K, and if applicable, the Company’s Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, which are available on the Company’s Investor Relations website at https://www.amplifyenergy.com/investor-relations/sec-filings/default.aspx or on the SEC’s website at http://www.sec.gov, for a discussion of risks and uncertainties that could cause actual results to differ from those in such forward-looking statements. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. All forward-looking statements in this press release are qualified in their entirety by these cautionary statements. Except as required by law, the Company undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.

    Use of Non-GAAP Financial Measures

    This press release and accompanying schedules include the non-GAAP financial measures of Adjusted EBITDA, Adjusted Net Income (Loss), free cash flow, net debt, PV-10 and cash G&A. The accompanying schedules provide a reconciliation of these non-GAAP financial measures to their most directly comparable financial measures calculated and presented in accordance with GAAP. Amplify’s non-GAAP financial measures should not be considered as alternatives to GAAP measures such as net income, operating income, net cash flows provided by operating activities, standardized measure of discounted future net cash flows, or any other measure of financial performance calculated and presented in accordance with GAAP. Amplify’s non-GAAP financial measures may not be comparable to similarly titled measures of other companies because they may not calculate such measures in the same manner as Amplify does.

    Adjusted EBITDA. Amplify defines Adjusted EBITDA as net income (loss) plus Interest expense, net; Income tax expense (benefit); DD&A; Accretion of AROs; Loss or (gain) on commodity derivative instruments; Cash settlements received or (paid) on expired commodity derivative instruments; Amortization of gain associated with terminated commodity derivatives; Losses or (gains) on sale of properties; Share-based compensation expenses; Exploration costs; Acquisition and divestiture related costs; Loss on settlement of AROs; Bad debt expense; and Pipeline incident loss. Adjusted EBITDA is commonly used as a supplemental financial measure by management and external users of Amplify’s financial statements, such as investors, research analysts and rating agencies, to assess: (1) its operating performance as compared to other companies in Amplify’s industry without regard to financing methods, capital structures or historical cost basis; (2) the ability of its assets to generate cash sufficient to pay interest and support Amplify’s indebtedness; and (3) the viability of projects and the overall rates of return on alternative investment opportunities. Since Adjusted EBITDA excludes some, but not all, items that affect net income or loss and because these measures may vary among other companies, the Adjusted EBITDA data presented in this press release may not be comparable to similarly titled measures of other companies. The GAAP measures most directly comparable to Adjusted EBITDA are net income and net cash provided by operating activities.

    Adjusted Net Income (Loss). Amplify defines Adjusted Net Income (Loss) as net income (loss) adjusted for unrealized loss (gain) on commodity derivative instruments, acquisition and divestiture-related expenses, unusual and infrequent items, and the income tax expense or benefit of these adjustments using our federal statutory tax rate. Adjusted Net Income (Loss) excludes the impact of unusual and infrequent items affecting earnings that vary widely and unpredictably. This measure is not meant to disassociate these items from management’s performance but rather is intended to provide helpful information to investors interested in comparing our performance between periods. Adjusted Net Income (Loss) is not considered to be an alternative to net income (loss) reported in accordance with GAAP.

    Free cash flow. Amplify defines free cash flow as Adjusted EBITDA, less cash interest expense and capital expenditures. Free cash flow is an important non-GAAP financial measure for Amplify’s investors since it serves as an indicator of the Company’s success in providing a cash return on investment. The GAAP measures most directly comparable to free cash flow are net income and net cash provided by operating activities.

    Net debt. Amplify defines net debt as the total principal amount drawn on the revolving credit facility less cash and cash equivalents. The Company uses net debt as a measure of financial position and believes this measure provides useful additional information to investors to evaluate the Company’s capital structure and financial leverage.

    PV-10. PV-10 is a non-GAAP financial measure that represents the present value of estimated future cash inflows from proved oil and natural gas reserves that are calculated using the unweighted arithmetic average first-day-of-the-month prices for the prior 12 months, less future development and operating costs, discounted at 10% per annum to reflect the timing of future cash flows. The most directly comparable GAAP measure to PV-10 is standardized measure. PV-10 differs from standardized measure in its treatment of estimated future income taxes, which are excluded from PV-10. Amplify believes the presentation of PV-10 provides useful information because it is widely used by investors in evaluating oil and natural gas companies without regard to specific income tax characteristics of such entities. PV-10 is not intended to represent the current market value of our estimated proved reserves. PV-10 should not be considered in isolation or as a substitute for the standardized measure as defined under GAAP. As GAAP does not prescribe a comparable GAAP measure for PV-10 of reserves adjusted for pricing sensitives, it is not practicable for us to reconcile PV-10 to a standardized measure or any other GAAP measure.

    Cash G&A. Amplify defines cash G&A as general and administrative expense, less share-based compensation expense; acquisition and divestiture costs; bad debt expense; and severance payments. Cash G&A is an important non-GAAP financial measure for Amplify’s investors since it allows for analysis of G&A spend without regard to share-based compensation and other non-recurring expenses which can vary substantially from company to company. The GAAP measures most directly comparable to cash G&A is total G&A expenses.

    Contacts

    Jim Frew — Senior Vice President and Chief Financial Officer
    (832) 219-9044
    jim.frew@amplifyenergy.com

    Michael Jordan — Director, Finance and Treasurer
    (832) 219-9051
    michael.jordan@amplifyenergy.com

    Selected Operating and Financial Data (Tables)

    Amplify Energy Corp.      
    Selected Financial Data – Unaudited      
    Statements of Operations Data      
             
        Three Months   Three Months
        Ended   Ended
    (Amounts in $000s, except per share data) March 31, 2025   December 31, 2024
             
    Revenues:      
      Oil and natural gas sales $ 70,341     $ 67,189  
      Other revenues   1,709       1,832  
      Total revenues   72,050       69,021  
             
    Costs and Expenses:      
      Lease operating expense   37,417       35,100  
      Pipeline incident loss   396       2,405  
      Gathering, processing and transportation   4,286       4,468  
      Exploration   6       10  
      Taxes other than income   4,384       5,356  
      Depreciation, depletion and amortization   8,494       8,418  
      General and administrative expense   10,815       9,486  
      Accretion of asset retirement obligations   2,183       2,156  
      Realized (gain) loss on commodity derivatives   (503 )     (4,052 )
      Unrealized (gain) loss on commodity derivatives   14,820       13,357  
      (Gain) loss on sale of properties   (6,251 )     (1,367 )
      Other, net   (3 )     334  
      Total costs and expenses   76,044       75,671  
             
    Operating Income (loss)   (3,994 )     (6,650 )
             
    Other Income (Expense):      
      Interest expense, net   (3,519 )     (3,684 )
      Other income (expense)   115       (113 )
      Total other income (expense)   (3,404 )     (3,797 )
             
      Income (loss) before reorganization items, net and income taxes   (7,398 )     (10,447 )
             
    Income tax benefit (expense) – current   (1 )     2,132  
    Income tax benefit (expense) – deferred   1,538       886  
             
      Net income (loss) $ (5,861 )   $ (7,429 )
             
    Earnings per share:      
      Basic and diluted earnings (loss) per share $ (0.15 )   $ (0.19 )
             
    Selected Financial Data – Unaudited      
    Operating Statistics      
               
          Three Months   Three Months
          Ended   Ended
    (Amounts in $000s, except per unit data) March 31, 2025   December 31, 2024
               
    Oil and natural gas revenue:      
      Oil Sales $ 49,982   $ 50,817
      NGL Sales   6,157     6,602
      Natural Gas Sales   14,202     9,770
      Total oil and natural gas sales – Unhedged $ 70,341   $ 67,189
               
    Production volumes:      
      Oil Sales – MBbls   737     760
      NGL Sales – MBbls   263     299
      Natural Gas Sales – MMcf   3,647     3,883
      Total – MBoe   1,607     1,706
      Total – MBoe/d   17.9     18.5
               
    Average sales price (excluding commodity derivatives):      
      Oil – per Bbl $ 67.82   $ 66.82
      NGL – per Bbl $ 23.46   $ 22.09
      Natural gas – per Mcf $ 3.89   $ 2.52
      Total – per Boe $ 43.76   $ 39.37
               
    Average unit costs per Boe:      
      Lease operating expense $ 23.28   $ 20.57
      Gathering, processing and transportation $ 2.67   $ 2.62
      Taxes other than income $ 2.73   $ 3.14
      General and administrative expense $ 6.73   $ 5.56
      Realized gain/(loss) on commodity derivatives $ 0.31   $ 2.38
      Depletion, depreciation, and amortization $ 5.29   $ 4.93
               
    Selected Financial Data – Unaudited      
    Asset Operating Statistics      
             
        Three Months   Three Months
        Ended   Ended
        March 31, 2025   December 31, 2024
             
    Production volumes – MBOE:      
      Bairoil   280       293  
      Beta   315       308  
      Oklahoma   393       436  
      East Texas / North Louisiana   570       609  
      Eagle Ford (Non-op)   49       60  
      Total – MBoe   1,607       1,706  
      Total – MBoe/d   17.9       18.5  
      % – Liquids   62 %     62 %
             
    Lease operating expense – $M:      
      Bairoil $ 13,732     $ 11,800  
      Beta   13,305       12,113  
      Oklahoma   3,856       3,948  
      East Texas / North Louisiana   4,981       5,887  
      Eagle Ford (Non-op)   1,542       1,351  
      Total Lease operating expense: $ 37,416     $ 35,099  
             
    Capital expenditures – $M:      
      Bairoil $ 1,322     $ 190  
      Beta   12,733       10,001  
      Oklahoma   1,445       168  
      East Texas / North Louisiana   3,449       2,758  
      Eagle Ford (Non-op)   3,905       2,125  
      Magnify Energy Services   263       82  
      Total Capital expenditures: $ 23,117     $ 15,324  
             
    Selected Financial Data – Unaudited              
    Balance Sheet Data              
                       
    (Amounts in $000s) March 31, 2025
      December 31, 2024
                       
    Assets              
      Cash and Cash Equivalents $     $  
      Accounts Receivable   35,893       39,713  
      Other Current Assets   24,296       32,064  
        Total Current Assets $ 60,189     $ 71,777  
                       
      Net Oil and Gas Properties $ 400,770     $ 386,218  
      Other Long-Term Assets   292,680       289,081  
        Total Assets $ 753,639     $ 747,076  
                       
    Liabilities              
      Accounts Payable $ 19,863     $ 13,231  
      Accrued Liabilities   40,343       43,413  
      Other Current Liabilities   18,658       11,494  
        Total Current Liabilities $ 78,864     $ 68,138  
                       
      Long-Term Debt $ 125,000     $ 127,000  
      Asset Retirement Obligation   131,158       129,700  
      Other Long-Term Liabilities   15,680       13,326  
        Total Liabilities $ 350,702     $ 338,164  
                       
    Shareholders’ Equity              
      Common Stock & APIC $ 440,266     $ 440,380  
      Accumulated Earnings (Deficit)   (37,329 )     (31,468 )
        Total Shareholders’ Equity $ 402,937     $ 408,912  
                       
    Selected Financial Data – Unaudited      
    Statements of Cash Flows Data      
           
      Three Months   Three Months
      Ended   Ended
    (Amounts in $000s) March 31, 2025   December 31, 2024
           
           
    Net cash provided by (used in) operating activities $ 25,501     $ 12,455  
    Net cash provided by (used in) investing activities   (21,497 )     (19,379 )
    Net cash provided by (used in) financing activities   (4,004 )     6,924  
           
    Selected Operating and Financial Data (Tables)      
    Reconciliation of Unaudited GAAP Financial Measures to Non-GAAP Financial Measures    
    Adjusted EBITDA and Free Cash Flow      
             
        Three Months   Three Months
        Ended   Ended
    (Amounts in $000s) March 31, 2025   December 31, 2024
             
    Reconciliation of Adjusted EBITDA to Net Cash Provided from Operating Activities:    
      Net cash provided by operating activities $ 25,501     $ 12,455  
      Changes in working capital   (5,372 )     4,770  
      Interest expense, net   3,519       3,684  
      Amortization of gain associated with terminated commodity derivatives   159       159  
      Amortization and write-off of deferred financing fees   (315 )     (315 )
      Exploration costs   6       10  
      Acquisition and divestiture related costs   1,629       1,424  
      Plugging and abandonment cost   171       754  
      Current income tax expense (benefit)   1       (2,132 )
      Pipeline incident loss   396       2,405  
      (Gain) loss on sale of properties   (6,251 )     (1,367 )
    Adjusted EBITDA: $ 19,444     $ 21,847  
             
    Reconciliation of Free Cash Flow to Net Cash Provided from Operating Activities:    
    Adjusted EBITDA: $ 19,444     $ 21,847  
      Less: Cash interest expense   3,545       3,598  
      Less: Capital expenditures   23,117       15,324  
    Free Cash Flow: $ (7,218 )   $ 2,925  
             
    Selected Operating and Financial Data (Tables)      
    Reconciliation of Unaudited GAAP Financial Measures to Non-GAAP Financial Measures    
    Adjusted EBITDA and Free Cash Flow      
             
        Three Months   Three Months
        Ended   Ended
    (Amounts in $000s) March 31, 2025   December 31, 2024
             
    Reconciliation of Adjusted EBITDA to Net Income (Loss):      
      Net income (loss) $ (5,861 )   $ (7,429 )
      Interest expense, net   3,519       3,684  
      Income tax expense (benefit) – current   1       (2,132 )
      Income tax expense (benefit) – deferred   (1,538 )     (886 )
      Depreciation, depletion and amortization   8,494       8,418  
      Accretion of asset retirement obligations   2,183       2,156  
      (Gains) losses on commodity derivatives   14,317       9,305  
      Cash settlements received (paid) on expired commodity derivative instruments   503       4,052  
      Amortization of gain associated with terminated commodity derivatives   159       159  
      Acquisition and divestiture related costs   1,629       1,424  
      Share-based compensation expense   1,890       1,686  
      (Gain) loss on sale of properties   (6,251 )     (1,367 )
      Exploration costs   6       10  
      Loss on settlement of AROs   (3 )     334  
      Bad debt expense         28  
      Pipeline incident loss   396       2,405  
    Adjusted EBITDA: $ 19,444     $ 21,847  
             
      Reconciliation of Free Cash Flow to Net Income (Loss):      
      Adjusted EBITDA: $ 19,444     $ 21,847  
      Less: Cash interest expense   3,545       3,598  
      Less: Capital expenditures   23,117       15,324  
      Free Cash Flow: $ (7,218 )   $ 2,925  
             
    Selected Operating and Financial Data (Tables)      
    Reconciliation of Unaudited GAAP Financial Measures to Non-GAAP Financial Measures    
    Net Income (Loss) to Adjusted Net Income (Loss)      
               
          Three Months   Three Months
          Ended   Ended
    (Amounts in $000s, except per share data) March 31, 2025   December 31, 2024
               
    Reconciliation of Adjusted Net Income (Loss):      
      Net income (loss) $ (5,861 )   $ (7,429 )
      Unrealized (gain) loss on commodity derivatives   14,820       13,357  
      Acquisition and divestiture related costs   1,629       1,424  
      Non-recurring costs:      
        Income tax expense (benefit) – deferred   (1,538 )     (886 )
        Gain on sale of properties   (6,251 )     (1,367 )
      Tax effect of adjustments   971       (12 )
        Adjusted net income (loss) $ 3,770     $ 5,087  
               
    Selected Operating and Financial Data (Tables)          
    Reconciliation of Unaudited GAAP Financial Measures to Non-GAAP Financial Measures      
    Cash General and Administrative Expenses          
               
      Three Months   Three Months
      Ended   Ended
    (Amounts in $000s) March 31, 2025   December 31, 2024
               
    General and administrative expense $ 10,815   $ 9,486
    Less: Share-based compensation expense   1,890     1,686
    Less: Acquisition and divestiture costs   1,629     1,424
    Less: Bad debt expense       28
    Less: Severance payments      
    Total Cash General and Administrative Expense $ 7,296   $ 6,348
               

    The MIL Network

  • MIL-OSI: GigaCloud Technology Inc Announces First Quarter Ended March 31, 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    EL MONTE, Calif., May 12, 2025 (GLOBE NEWSWIRE) — GigaCloud Technology Inc (Nasdaq: GCT) (“GigaCloud” or the “Company”), a pioneer of global end-to-end B2B technology solutions for large parcel merchandise, today announced financial results for the first quarter ended March 31, 2025, including sustained revenue and GMV growth over the comparable prior year period.

    First Quarter 2025 Financial Highlights

    • Total revenues of $271.9 million, increased 8.3% year-over-year.
    • Gross profit of $63.7 million, decreased 4.2% year-over-year.
      Gross margin was 23.4%, compared to 26.5% in the first quarter of 2024.
    • Net income of $27.1 million, in line with $27.2 million reported in the prior-year period.
      Net income margin was 10.0%, compared to 10.8% in the first quarter of 2024.
      Diluted EPS increased 3.0% year-over-year to $0.68.
    • Adjusted EBITDA1 of $33.2 million, decreased 3.8% year-over-year.
      Adjusted EPS – diluted2 of $0.83, decreased 1.2% year-over-year.
    • Cash and cash equivalents, Restricted Cash, and Investments totaled $287.5 million as of March 31, 2025, a 5.1% decrease from December 31, 2024.

    Operational Highlights

    • GigaCloud Marketplace GMV3 increased 56.1% year-over-year to $1,416.7 million for the 12 months ended March 31, 2025.
    • 3P seller GigaCloud Marketplace GMV4 increased 49.9% year-over-year to $734.3 million for the 12 months ended March 31, 2025. 3P seller GigaCloud Marketplace GMV represented 51.8% of total GigaCloud Marketplace GMV for the 12 months ended March 31, 2025.
    • Active 3P sellers5 increased 33.4% year-over-year to 1,154 for the 12 months ended March 31, 2025.
    • Active buyers6 increased 81.4% year-over-year to 9,966 for the 12 months ended March 31, 2025.
    • Spend per active buyer7 was $142,156 for the 12 months ended March 31, 2025.

    “Despite persistent industry headwinds, we continue to grow and see the strength of the GigaCloud Marketplace come through—buyers and sellers continue to lean in during times of volatility and challenge. That is a testament to the efficiency and value created by our Supplier Fulfilled Retailing (SFR) model,” said Larry Wu, Founder, Chairman, and Chief Executive Officer. “We are building GigaCloud to thrive for the long-term by empowering our partners to do business smarter in an increasingly complex global market. While we are actively managing near-term macro uncertainty, the positive long-term fundamentals reinforce our confidence in delivering lasting value.”

    “In September 2024, our Board of Directors approved a share repurchase program of $46 million, and subsequently increased the total authorized amount to $62 million in March 2025. As of today, we have repurchased approximately 3.7 million shares for $61.8 million—close to 150% of the gross proceeds raised in our IPO—at a weighted average price well above our IPO offering price. We remain positioned to deploy additional capital through future repurchase authorizations, balancing capital returns and growth investments to drive future shareholder value creation,” said Erica Wei, Chief Financial Officer.

    Business Outlook

    The Company expects its total revenues to be between $275 million and $305 million in the second quarter of 2025. This forecast reflects the Company’s current and preliminary views on the market and operational conditions, which are subject to change and cannot be predicted with reasonable accuracy as of the date hereof.

    Share Repurchase Program

    In September 2024, the Company’s Board of Directors (the “Board”) approved a $46 million share repurchase program, which was increased by $16 million to $62 million on March 28, 2025. Following quarter-end, on May 8, 2025, the Board approved an additional $16 million, bringing the total authorization to $78 million. The program runs through August 28, 2025. As of May 12, 2025, the Company has repurchased approximately 3.7 million of its Class A ordinary shares for $61.8 million.

    Under the share repurchase program, the Company may purchase its ordinary shares through various means, including open market transactions, privately negotiated transactions, block trades, any combination thereof or other legally permissible means. The Company may effect repurchase transactions in compliance with Rule 10b5-1 and Rule 10b-18 of the Securities Exchange Act of 1934, as amended. The number of shares repurchased and the timing of repurchases will depend on a number of factors, including, but not limited to, price, trading volume and general market conditions, along with the Company’s working capital requirements, general business conditions and other factors.

    Conference Call

    The Company will host a conference call to discuss its financial results at 6:30 pm U.S. Eastern Time on May 12, 2025. Participants who wish to join the call should pre-register here at https://s1.c-conf.com/diamondpass/10046996-fh4na1.html. Upon registration, participants will receive the dial-in number and a unique PIN, which can be used to join the conference call. If participants register and forget their PIN or lose their registration confirmation email, they may re-register to receive a new PIN. All participants are encouraged to dial in 15 minutes prior to the start time.

    A live and archived webcast of the conference call will be accessible on the Company’s investor relations website at: https://investors.gigacloudtech.com/.

    About GigaCloud Technology Inc

    GigaCloud Technology Inc is a pioneer of global end-to-end B2B technology solutions for large parcel merchandise. The Company’s B2B ecommerce platform, which it refers to as the “GigaCloud Marketplace,” integrates everything from discovery, payments and logistics tools into one easy-to-use platform. The Company’s global marketplace seamlessly connects manufacturers, primarily in Asia, with resellers, primarily in the U.S., Asia and Europe, to execute cross-border transactions with confidence, speed and efficiency. The Company offers a truly comprehensive solution that transports products from the manufacturer’s warehouse to the end customer’s doorstep, all at one fixed price. The Company first launched its marketplace in January 2019 by focusing on the global furniture market and has since expanded into additional categories such as home appliances and fitness equipment. For more information, please visit the Company’s website: https://investors.gigacloudtech.com/.

    Non-GAAP Financial Measures

    The Company uses certain non-GAAP financial measures, including Adjusted EBITDA and Adjusted EPS – diluted, to understand and evaluate its core operating performance. Adjusted EBITDA is net income excluding interest, income taxes and depreciation, further adjusted to exclude share-based compensation expense. Adjusted EPS – diluted is a financial measure defined as our Adjusted EBITDA divided by our diluted weighted-average shares outstanding, respectively. Management uses Adjusted EBITDA and Adjusted EPS – diluted as measures of operating performance, for planning purposes, to allocate resources to enhance the financial performance of our business, to evaluate the effectiveness of our business strategies and in communications with our Board of Directors and investors concerning our financial performance. Non-GAAP financial measures, which may differ from similarly titled measures used by other companies, are presented to enhance investors’ overall understanding of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with U.S. GAAP.

    For more information on the non-GAAP financial measures, please see the tables captioned “Unaudited Reconciliation of Adjusted EBITDA” and “Unaudited Reconciliation of Adjusted EPS – diluted” set forth at the end of this press release.

    Forward-Looking Statements

    This press release contains “forward-looking statements”. Forward-looking statements reflect our current view about future events. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can identify these forward-looking statements by words or phrases such as “may,” “will,” “could,” “expect,” “anticipate,” “aim,” “estimate,” “intend,” “plan,” “believe,” “is/are likely to,” “propose,” “potential,” “continue” or similar expressions. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company’s registration statement and other filings with the SEC.

    For investor and media inquiries, please contact:

    GigaCloud Technology Inc

    Investor Relations

    Email: ir@gigacloudtech.com

    PondelWilkinson, Inc.

    Laurie Berman (Investors) – lberman@pondel.com

    George Medici (Media) – gmedici@pondel.com

     
    GigaCloud Technology Inc
    UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
    (In thousands except for share data and per share data)
     
        March 31,
    2025
      December 31,
    2024
    ASSETS        
    Current assets        
    Cash and cash equivalents   $ 251,711   $ 259,759
    Restricted cash     697     685
    Investments     35,101     42,674
    Accounts receivable, net     67,000     57,313
    Inventories     204,854     172,489
    Prepayments and other current assets     19,842     14,672
    Total current assets     579,205     547,592
    Non-current assets        
    Operating lease right-of-use assets     438,692     451,930
    Property and equipment, net     32,688     29,498
    Intangible assets, net     5,893     6,198
    Goodwill     12,586     12,586
    Deferred tax assets     11,366     10,026
    Other non-current assets     10,607     12,645
    Total non-current assets     511,832     522,883
    Total assets   $ 1,091,037   $ 1,070,475
     
    GigaCloud Technology Inc
    UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS (continued)
    (In thousands)
     
      March 31,
    2025
      December 31,
    2024
    LIABILITIES AND SHAREHOLDERS’ EQUITY      
    Current liabilities      
    Accounts payable $ 87,814     $ 78,163  
    Contract liabilities   5,665       4,486  
    Current operating lease liabilities   90,823       88,521  
    Income tax payable   20,001       13,615  
    Accrued expenses and other current liabilities   87,510       79,594  
    Total current liabilities   291,813       264,379  
    Non-current liabilities      
    Operating lease liabilities, non-current   380,842       395,235  
    Deferred tax liabilities   759       941  
    Finance lease obligations, non-current   241       382  
    Non-current income tax payable   4,485       4,321  
    Total non-current liabilities   386,327       400,879  
    Total liabilities $ 678,140     $ 665,258  
    Commitments and contingencies $     $  
    Shareholders’ equity        
    Treasury shares, at cost (2,008,984 and 609,390 shares held as of March 31, 2025 and December 31, 2024, respectively)   $ (34,550 )   $ (11,816 )
    Class A ordinary shares $0.05 par value, 50,673,268 shares authorized, 32,881,519 and 32,878,735 shares issued as of March 31, 2025 and December 31, 2024, respectively, 30,872,535 and 32,269,345 shares outstanding as of March 31, 2025 and December 31, 2024, respectively)     1,643       1,643  
    Class B ordinary shares ($0.05 par value, 9,326,732 shares authorized as of March 31, 2025 and December 31, 2024, 8,076,732 shares issued and outstanding as of March 31, 2025 and December 31, 2024)     403       403  
    Additional paid-in capital     121,490       120,262  
    Accumulated other comprehensive loss     (2,096 )     (4,136 )
    Retained earnings     326,007       298,861  
    Total shareholders’ equity     412,897       405,217  
    Total liabilities and shareholders’ equity   $ 1,091,037     $ 1,070,475  
     
    GigaCloud Technology Inc
    UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
    (In thousands except for share data and per share data)
     
      Three Months Ended
    March 31,
        2025       2024  
    Revenues      
    Service revenues $ 94,068     $ 76,623  
    Product revenues   177,838       174,454  
    Total revenues   271,906       251,077  
    Cost of revenues      
    Services   79,156       62,700  
    Products   129,024       121,829  
    Total cost of revenues   208,180       184,529  
    Gross profit   63,726       66,548  
    Operating expenses      
    Selling and marketing expenses   18,558       14,580  
    General and administrative expenses   14,340       15,389  
    Research and development expenses   2,493       1,756  
    Losses on disposal of property and equipment   12       6  
    Total operating expenses   35,403       31,731  
    Operating income   28,323       34,817  
    Interest expense   (23 )     (81 )
    Interest income   2,621       1,609  
    Foreign currency exchange gains (losses), net   792       (2,709 )
    Government grants   213       6  
    Others, net   579       (322 )
    Income before income taxes   32,505       33,320  
    Income tax expense   (5,359 )     (6,125 )
    Net income $ 27,146     $ 27,195  
    Net income attributable to ordinary shareholders   27,146       27,195  
    Foreign currency translation adjustment, net of income taxes of nil   411       (112 )
    Net unrealized loss on available-for-sale investments   (6 )      
    Intra-entity foreign currency transactions gain   1,636        
    Release of foreign currency translation reserve related to liquidation of subsidiaries   (1 )      
    Total other comprehensive income (loss)   2,040       (112 )
    Comprehensive Income $ 29,186     $ 27,083  
    Net income per ordinary share      
    —Basic $ 0.68     $ 0.67  
    —Diluted $ 0.68     $ 0.66  
    Weighted average number of ordinary shares outstanding used in computing net income per ordinary share      
    —Basic   40,020,265       40,788,658  
    —Diluted   40,138,522       40,950,170  
     
    GigaCloud Technology Inc
    UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (In thousands)
     
      Three Months Ended March 31,
        2025       2024  
    Cash flows from operating activities:      
    Net income $ 27,146     $ 27,195  
    Adjustments to reconcile net income to net cash provided by operating activities:      
    Depreciation and amortization   2,049       2,081  
    Share-based compensation   1,227       275  
    Operating lease   1,125       8,806  
    Changes in accounts receivables, net   (9,011 )     (632 )
    Changes in inventories   (30,845 )     (56,047 )
    Changes in prepayments and other assets   (3,217 )     (2,364 )
    Changes in accounts payable, accrued expenses and other current liabilities   14,551       27,886  
    Changes in contract liabilities   1,096       2,045  
    Changes in income tax payable   6,418       6,552  
    Changes in deferred income taxes   (1,511 )     (2,034 )
    Other operating activities   405       1,546  
    Net cash provided by operating activities   9,433       15,309  
    Cash flows from investing activities:      
    Purchases of property and equipment   (2,395 )     (3,993 )
    Disposals of property and equipment   34       1,525  
    Purchases of investments   (25,000 )     (10,000 )
    Sales and maturities of investments   31,986        
    Net cash provided by (used in) investing activities   4,625       (12,468 )
    Cash flows from financing activities:      
    Repayment of finance lease obligations   (34 )     (595 )
    Repurchases of ordinary shares   (22,734 )      
    Net cash used in financing activities   (22,768 )     (595 )
    Effect of foreign currency exchange rate changes on cash, cash equivalents and restricted cash   674       (306 )
    Net increase (decrease) in cash, cash equivalents and restricted cash   (8,036 )     1,940  
    Cash, cash equivalents and restricted cash at the beginning of the period   260,444       184,168  
    Cash, cash equivalents and restricted cash at the end of the period $ 252,408     $ 186,108  
    Supplemental disclosure of cash flow information      
    Cash paid for interest expense   23       81  
    Cash paid for income taxes   552       1,596  
     
    GigaCloud Technology Inc
    UNAUDITED RECONCILIATION OF ADJUSTED EBITDA
    (In thousands, except for per share data)
     
      Three Months Ended
    March 31,
        2025       2024  
      (In thousands)
    Net Income $ 27,146     $ 27,195  
    Add: Income tax expense   5,359       6,125  
    Add: Interest expense   23       81  
    Less: Interest income   (2,621 )     (1,609 )
    Add: Depreciation and amortization   2,049       2,081  
    Add: Share-based compensation expenses   1,227       275  
    Add: Non-recurring items(1)         349  
    Adjusted EBITDA $ 33,183     $ 34,497  

    ________________________
    (1) During the three months ended March 31, 2024, one of our fulfillment centers in Japan experienced a fire. As a result of the fire, we recognized losses of $1.8 million. Based on the provisions of our insurance policy, we have determined that partial recovery of the incurred losses is probable as of March 31, 2024 and therefore recorded an insurance recovery of $1.5 million. We do not believe such losses to be recurring or frequent in nature.

    UNAUDITED RECONCILIATION OF ADJUSTED EPS – DILUTED

      Three Months Ended
    March 31,
        2025       2024  
    Net income per ordinary share – diluted $ 0.68     $ 0.66  
    Adjustments, per ordinary share:      
    Add: Income tax expense   0.13       0.15  
    Add: Interest expense          
    Less: Interest income   (0.07 )     (0.04 )
    Add: Depreciation and amortization   0.05       0.05  
    Add: Share-based compensation expenses   0.04       0.01  
    Add: Non-recurring items(1)         0.01  
    Adjusted EPS – diluted $ 0.83     $ 0.84  
           
    Weighted average number of ordinary shares outstanding – diluted   40,138,522       40,950,170  

    ________________________
    (1) During the three months ended March 31, 2024, one of our fulfillment centers in Japan experienced a fire. As a result of the fire, we recognized losses of $1.8 million. Based on the provisions of our insurance policy, we have determined that partial recovery of the incurred losses is probable as of March 31, 2024 and therefore recorded an insurance recovery of $1.5 million. We do not believe such losses to be recurring or frequent in nature.

    ________________________
    1 Adjusted EBITDA is a non-GAAP financial measure. For more information on the non-GAAP financial measure, please see the section of “Non-GAAP Financial Measure” and the table captioned “Unaudited Reconciliation of Adjusted EBITDA” set forth at the end of this press release.

    2 Adjusted EPS – diluted is a non-GAAP financial measure. For more information on the non-GAAP financial measure, please see the section of “Non-GAAP Financial Measure” and the table captioned “Unaudited Reconciliation of Adjusted EPS – diluted” set forth at the end of this press release.

    3 GigaCloud Marketplace GMV means the total gross merchandise value of transactions ordered through our GigaCloud Marketplace including GigaCloud 3P and GigaCloud 1P, before any deductions of value added tax, goods and services tax, shipping charges paid by buyers to sellers and any refunds.

    4 3P seller GigaCloud Marketplace GMV means the total gross merchandise value of transactions sold through our GigaCloud Marketplace by 3P sellers, before any deductions of value added tax, goods and services tax, shipping charges paid by buyers to sellers and any refunds.

    5 Active 3P sellers means sellers who have sold a product in GigaCloud Marketplace within the last 12-month period, irrespective of cancellations or returns.

    6 Active buyers means buyers who have purchased a product in the GigaCloud Marketplace within the last 12-month period, irrespective of cancellations or returns.

    7 Spend per active buyer is calculated by dividing the total GigaCloud Marketplace GMV within the last 12-month period by the number of active buyers as of such date.

    The MIL Network

  • MIL-OSI: PennantPark Floating Rate Capital Ltd. Announces Financial Results for the Second Quarter Ended March 31, 2025

    Source: GlobeNewswire (MIL-OSI)

    MIAMI, May 12, 2025 (GLOBE NEWSWIRE) — PennantPark Floating Rate Capital Ltd. (NYSE: PFLT) announced today its financial results for the second quarter ended March 31, 2025.

    HIGHLIGHTS
    Quarter ended March 31, 2025 (Unaudited)
    ($ in millions, except per share amounts)
             
               
    Assets and Liabilities:          
    Investment portfolio (1)       $ 2,344.1  
    Net assets       $ 1,067.1  
    GAAP net asset value per share       $ 11.07  
    Quarterly change in GAAP net asset value per share         (2.4 )%
    Adjusted net asset value per share (2)       $ 11.07  
    Quarterly change in adjusted net asset value per share (2)         (2.4 )%
               
    Credit Facility       $ 273.8  
    2036 Asset-Backed Debt       $ 284.4  
    2036-R Asset-Backed Debt       $ 265.3  
    2026 Notes       $ 184.2  
    2037 Asset-Backed Debt       $ 358.1  
    Regulatory debt to equity       1.29x  
    Weighted average yield on debt investments at quarter-end         10.5 %
               
    Operating Results:          
    Net investment income       $ 25.0  
    Net investment income per share (GAAP)       $ 0.28  
    Core net investment income per share (3)       $ 0.28  
    Distributions declared per share       $ 0.31  
               
    Portfolio Activity:          
    Purchases of investments       $ 293.3  
    Sales and repayments of investments       $ 122.4  
               
    PSSL Portfolio data:          
    PSSL investment portfolio       $ 1,060.2  
    Purchases of investments       $ 60.0  
    Sales and repayments of investments       $ 36.8  

    (1)    Includes investments in PennantPark Senior Secured Loan Fund I LLC, or PSSL, an unconsolidated joint venture, totaling $297.3 million, at fair value.

    (2)    This is a non-GAAP financial measure. The Company believes that this number provides useful information to investors and management because it reflects the Company’s financial performance excluding the impact of the unrealized amounts on the Credit Facility. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.

    (3)    Core net investment income (“Core NII”) is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company’s financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended March 31, 2025, Core NII excluded: i) $0.4m of credit facility amendment costs and ii) $0.1m of incentive fee expense offset.

    CONFERENCE CALL AT 9:00 A.M. ET ON May 13, 2025

    PennantPark Floating Rate Capital Ltd. (“we”, “our”, “us”, or the “Company”) will also host a conference call at 9:00 a.m. (Eastern Time) on Tuesday May 13, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (888) 394-8218 approximately 5-10 minutes prior to the call. International callers should dial (929) 477-0402. All callers should reference conference ID #6661250 or PennantPark Floating Rate Capital Ltd. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark’s website.

    PORTFOLIO AND INVESTMENT ACTIVITY

    “We are pleased that we significantly increased our financial strength during the quarter. A lower cost credit facility, a new low cost long term securitization, new low cost securitization at our PSSL JV and additional equity capital at PFLT have positioned us well to take advantage of the upcoming attractive vintage of new loans,” said Art Penn, Chairman and CEO. “Additionally, we are pleased that our senior secured loan portfolio, with among the lowest portfolio company leverage and most meaningful covenants in the industry, is positioned defensively and continues to perform well.”

    As of March 31, 2025, our portfolio totaled $2,344.1 million, and consisted of $2,100.2 million of first lien secured debt (including $237.7 million in PSSL), $4.4 million of subordinated debt and $239.5 million of preferred and common equity (including $59.6 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of March 31, 2025, we had four portfolio companies on non-accrual, representing 2.2% and 1.2% of our overall portfolio on a cost and fair value basis, respectively. As of March 31, 2025, the portfolio had net unrealized depreciation of $61.2 million. Our overall portfolio consisted of 159 companies with an average investment size of $14.7 million and had a weighted average yield on debt investments of 10.5%.

    As of September 30, 2024, our portfolio totaled $1,983.5 million and consisted of $1,746.7 million of first lien secured debt (including $237.7 million in PSSL), $2.7 million of second lien secured debt and subordinated debt and $234.1 million of preferred and common equity (including $56.5 million in PSSL). Our debt portfolio consisted of approximately 100% variable-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 0.4% and 0.2% of our overall portfolio on a cost and fair value basis, respectively. As of September 30, 2024, the portfolio had net unrealized depreciation of $11.4 million. Our overall portfolio consisted of 158 companies with an average investment size of $12.6 million, and a weighted average yield on debt investments of 11.5%.

    For the three months ended March 31, 2025, we invested $293.3 million in three new and 54 existing portfolio companies at a weighted average yield on debt investments of 9.9%. Sales and repayments of investments for the same period totaled $122.4 million including $52.9 million of sales to PSSL. For the six months ended March 31, 2025, we invested $900.2 million in 14 new and 96 existing portfolio companies with a weighted average yield on debt investments of 10.2%. Sales and repayments of investments for the same period totaled $523.7 million, including $240.6 million of sales to PSSL.

    For the three months ended March 31, 2024, we invested $338.3 million in 11 new and 48 existing portfolio companies at a weighted average yield on debt investments of 11.6%. For the three months ended March 31, 2024, sales and repayments of investments totaled $144.8 million, including $77.2 million of sales to PSSL. For the six months ended March 31, 2024, we invested $640.9 million in 24 new and 64 existing portfolio companies at a weighted average yield on debt investments of 11.8%. For the six months ended March 31, 2024, sales and repayments of investments totaled $248.7 million, including $139.9 million of sales to PSSL.

    PennantPark Senior Secured Loan Fund I LLC

    As of March 31, 2025, PSSL’s portfolio totaled $1,060.2 million, consisted of 118 companies with an average investment size of $9.0 million and had a weighted average yield on debt investments of 10.5%. As of September 30, 2024, PSSL’s portfolio totaled $913.3 million, consisted of 109 companies with an average investment size of $8.4 million and had a weighted average yield on debt investments of 11.4%.

    For the three months ended March 31, 2025, PSSL invested $60.0 million (including $52.9 million purchase from the Company) in four new and five existing portfolio companies with a weighted average yield on debt investments of 9.8%. PSSL’s sales and repayments of investments for the same period totaled $36.8 million. For the six months ended March 31, 2025, PSSL invested $284.9 million (including $240.6 million purchased from the Company) in 21 new and 12 existing portfolio companies with a weighted average yield on debt investments of 10.2%. PSSL’s sales and repayments of investments for the same period totaled $123.4 million.

    For the three months ended March 31, 2024, PSSL invested $80.1 million (including $77.2 million purchased from the Company) in six new and four existing portfolio companies at a weighted average yield on debt investments of 11.6%. Sales and repayments of investments for the three months ended March 31, 2024 totaled $49.5 million. For the six months ended March 31, 2024, PSSL invested $155.9 million (including $139.9 million purchased from the Company) in 10 new and 11 existing portfolio companies at a weighted average yield on debt investments of 11.9%. Sales and repayments of investments for the six months ended March 31, 2024 totaled $77.2 million.

    RESULTS OF OPERATIONS

    Set forth below are the results of operations for the three and six months ended March 31, 2025 and 2024.

    Investment Income

    For the three and six months ended March 31, 2025 investment income was $61.9 million and $128.9 million, respectively, which was attributable to $56.2 million and $117.2 million from first lien secured debt and $5.7 million and $11.7 million from other investments, respectively. For the three and six months ended March 31, 2024, investment income was $44.4 million and $82.3 million, respectively, which was attributable to $39.0 million and $72.2 million from first lien secured debt and $5.4 million and $10.1 million from other investments, respectively. The increase in investment income for the three and six months ended March 31, 2025, was primarily due to the increase in the size of the debt portfolio.

    Expenses

    For the three and six months ended March 31, 2025, expenses totaled $36.9 million and $74.0 million, respectively and were comprised of: $22.5 million and $44.9 million of debt related interest and expenses, $5.6 million and $10.9 million of base management fees, $6.3 million and $13.8 million of performance-based incentive fees, $1.9 million and $3.6 million of general and administrative expenses, $0.2 million and $0.5 million of taxes and $0.4 million and $0.4 million in Credit Facility amendment costs. For the three and six months ended March 31, 2024, expenses totaled $25.3 million and $43.8 million, respectively and were comprised of: $14.7 million and $23.6 million of debt related interest and expenses, $3.4 million and $6.4 million of base management fees, $4.8 million and $9.6 million of performance-based incentive fees, $1.8 million and $3.5 million of general and administrative expenses and $0.5 million and $0.7 million of taxes. The increase in expenses for the three and six months ended March 31, 2025, was primarily due to the increase in interest expense from increased borrowings and an increase in base management fees and incentive fee as a result of the increase in our investment portfolio.

    Net Investment Income

    For the three and six months ended March 31, 2025 net investment income totaled $25.0 million or $0.28 per share, and $55.0 million or $0.64 per share, respectively. For the three and six months ended March 31, 2024, net investment income totaled $19.1 million or $0.31 per share, and $38.5 million or $0.64 per share, respectively. The increase in net investment income for the three and six months ended March 31, 2025, was primarily due to an increase in investment income partially offset by an increase in expenses.

    Net Realized Gains or Losses

    For the three and six months ended March 31, 2025 net realized gains (losses) totaled $(3.5) million and $23.1 million, respectively. For the three and six months ended March 31, 2024, net realized gains (losses) totaled $4.0 million and $0.9 million, respectively. The change in net realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.

    Unrealized Appreciation or Depreciation on Investments and Debt

    For the three and six months ended March 31, 2025 we reported net change in unrealized appreciation (depreciation) on investments of $(20.8) million and $(49.7) million, respectively. For the three and six months ended March 31, 2024, we reported net change in unrealized appreciation (depreciation) on investments of $7.7 million and $13.9 million, respectively. As of March 31, 2025 and September 30, 2024, our net unrealized appreciation (depreciation) on investments totaled $(61.2) million and $(11.4) million, respectively. The net change in unrealized appreciation (depreciation) on our investments was primarily due to the operating performance of the portfolio companies within our portfolio, changes in the capital market conditions of our investments and realization of investments.

    For the three and six months ended March 31, 2025, our Credit Facility had a net change in unrealized appreciation (depreciation) of less than $0.1 million and $0.1 million, respectively. For the three and six months ended March 31, 2024, our Credit Facility had a net change in unrealized appreciation (depreciation) of less than $0.1 million and ($0.1) million, respectively. As of March 31, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Credit Facility totaled approximately $0.1 million and zero, respectively. The net change in net unrealized (appreciation) or depreciation was primarily due to changes in the capital markets.

    Net Change in Net Assets Resulting from Operations

    For the three and six months ended March 31, 2025, net increase (decrease) in net assets resulting from operations totaled $1.2 million or $0.01 per share and $29.6 million or $0.34 per share, respectively. For the three and six months ended March 31, 2024, net increase (decrease) in net assets resulting from operations totaled $31.1 million or $0.51 per share and $53.6 million, or $0.89 per share, respectively. The net increase or (decrease) from operations for the three and six months ended March 31, 2025, was primarily due to operating performance of our portfolio and changes in capital market conditions of our investments along with change in size and cost yield of our debt portfolio and costs of financing.

    LIQUIDITY AND CAPITAL RESOURCES

    Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments, and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations.

    In February 2025 the Company, through the 2037 Securitization Issuer, completed a $474.6 million term debt securitization of which we retained $85.1 million of subordinated notes and $28.5 million of BBB-(sf) Class D Notes of the debt securitization. The weighted average credit spread is 1.59%. This 2037 Asset-Backed Debt is scheduled to mature on April 20, 2037.

    For the six months ended March 31, 2025 and 2024, the annualized weighted average cost of debt, inclusive of the fee on the undrawn commitment on the Credit Facility, amendment costs and debt issuance costs, was 6.8% and 7.1%, respectively. As of March 31, 2025 and September 30, 2024, we had $462.1 million and $192.1 million of unused borrowing capacity under the Credit Facility, respectively, subject to leverage and borrowing base restrictions.

    As of March 31, 2025 and September 30, 2024, we had cash equivalents of $111.4 million and $112.1 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to take advantage of market opportunities.

    During the three and six months ended March 31, 2025 we issued 11,562,000 shares and 18,838,000 shares of our common stock through the 2024 ATM Program, respectively at an average price of $11.34 per share and $11.35 per share raising $131.0 million and $213.2 million of net proceeds after commissions to the Sales Agents and inclusive of proceeds from the Investment Adviser to ensure that all shares were sold at or above NAV, respectively. During the three and six months ended March 31, 2024, we issued 4,493,436 shares of common stock through the 2022 ATM Program at an average price of $11.35 per share, raising $51.0 million of net proceeds after commissions to the Sales Agents and inclusive of proceeds from the Investment Adviser to ensure that all shares were sold at or above NAV, respectively.

    For the six months ended March 31, 2025, our operating activities used cash of $350.8 million and our financing activities provided cash of $350.1 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily due to borrowings under our Credit Facility, proceeds from the 2037 Asset-Backed debt and proceeds from the public offerings under our 2024 ATM Program.

    For the six months ended March 31, 2024, our operating activities used cash of $354.5 million and our financing activities provided cash of $379.2 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily due to borrowings under the Credit Facility and proceeds from the 2036 Asset-Backed debt partially offset by the repayment of the 2023 Notes.

    DISTRIBUTIONS

    During the three and six months ended March 31, 2025 we declared distributions of $0.3075 and $0.615 per share for total distributions of $27.7 million and $52.9 million, respectively. During the three and six months ended March 31, 2024, we declared distributions of $0.3075 and $0.615 per share for total distributions of $18.8 million and $36.9 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.

    RECENT DEVELOPMENTS

    In April 2025, PennantPark Floating Rate Capital Ltd. amended its credit facility agreement led by Truist Bank. As part of the amendment, the Company pricing decreased to SOFR plus 200 basis points from SOFR plus 225 basis points, the reinvestment period was extended one year to August 2028, the maturity date was extended one year to August 2030, and the maximum first lien advance rate was increased to 72.5% from 70.0%. As part of this amendment, commitments decreased from $736 million to $718 million.

    In April 2025, PSSL through its wholly-owned and consolidated subsidiary, PennantPark CLO 12, LLC closed a four year reinvestment period, twelve-year final maturity $301 million debt securitization in the form of a collateralized loan obligation. The debt in this securitization is structured in the following manner: (i) $30.0 million of Class A-1 Loans, which bear interest at three-month SOFR plus 1.45%, (ii) $141.0 million of Class A-1 Notes,which bear interest at three-month SOFR plus 1.45%, (iii) $12.0 million of Class A-2 Notes, which bear interest at a three-month SOFR plus 1.60%, (iv) $21.0 million of Class B notes, which bears interest at three-month SOFR plus 1.85%, (v) $24.0 million of Class C notes, which bears interest at three-month SOFR plus 2.30%, (vi) $18.0 million Class D notes, which bears interest at three-month SOFR plus 3.30%, (vii) $55.0 million of Sub notes. The weighted average credit spread is 1.71%. PSSL will continue to retain all of the subordinated notes through a consolidated subsidiary. The reinvestment period for the term debt securitization ends in April 2029 and the debt is scheduled to mature in April 2037. The term debt securitization is expected to be approximately 100% funded at close. The proceeds from the debt will be used to repay a portion of PSSL’s $325 million secured credit facility.

    AVAILABLE INFORMATION

    The Company makes available on its website its Quarterly Report on Form 10-Q filed with the SEC, and stockholders may find such report on its website at www.pennantpark.com.

    PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
    (in thousands, except per share data)
     
       
        March 31, 2025     September 30, 2024  
        (unaudited)        
    Assets            
    Investments at fair value            
    Non-controlled, non-affiliated investments (amortized cost— $2,043,844 and $1,622,669, respectively)   $ 2,046,762     $ 1,632,269  
    Controlled, affiliated investments (amortized cost— $361,375 and $372,271, respectively)     297,290       351,235  
    Total investments (amortized cost— $2,405,219 and $1,994,940, respectively)     2,344,052       1,983,504  
    Cash and cash equivalents (cost— $111,368 and $112,046, respectively)     111,358       112,050  
    Interest receivable     11,094       12,167  
    Receivables from investments sold     2,048        
    Distributions receivable     946       635  
    Due from affiliate     82       291  
    Prepaid expenses and other assets     2,268       198  
    Total assets     2,471,848       2,108,845  
    Liabilities            
    Credit Facility payable, at fair value (cost— $273,855 and $443,855, respectively)     273,790       443,880  
    2026 Notes payable, net (par—$185,000)     184,220       183,832  
    2036 Asset-Backed Debt, net (par—$287,000)     284,357       284,086  
    2036-R Asset-Backed Debt, net (par-$266,000)     265,300       265,235  
    2037 Asset-Backed Debt, net (par— $361,000)     358,083        
    Payable for investments purchased           20,363  
    Interest payable on debt     15,202       14,645  
    Distributions payable     9,627       7,834  
    Base management fee payable     5,604       4,588  
    Incentive fee payable     6,258       3,189  
    Accounts payable and accrued expenses     1,664       2,187  
    Deferred tax liability     612       1,712  
    Total liabilities     1,404,717       1,231,551  
    Net assets            
    Common stock, 96,417,896 and 77,579,896 shares issued and outstanding, respectively Par value $0.001 per share and 200,000,000 shares authorized     96       78  
    Paid-in capital in excess of par value     1,189,888       976,744  
    Accumulated deficit     (122,853 )     (99,528 )
    Total net assets   $ 1,067,131     $ 877,294  
    Total liabilities and net assets   $ 2,471,848     $ 2,108,845  
    Net asset value per share   $ 11.07     $ 11.31  
    PENNANTPARK FLOATING RATE CAPITAL LTD. AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except per share data)
    (Unaudited)
     
       
        Three Months Ended
    March 31,
        Six months Ended
    March 31,
     
        2025     2024     2025     2024  
    Investment income:                        
    From non-controlled, non-affiliated investments:                        
    Interest   $ 49,215     $ 30,470     $ 96,678     $ 54,238  
    Dividend     369       577       946       1,085  
    Other income     634       1,268       2,114       3,031  
    From controlled, affiliated investments:                        
    Interest     7,345       8,320       20,153       16,754  
    Dividend     4,375       3,719       8,750       7,219  
    Other income                 306        
    Total investment income     61,938       44,354       128,947       82,327  
    Expenses:                        
    Interest and expenses on debt     22,529       14,688       44,890       23,630  
    Performance-based incentive fee     6,258       4,767       13,750       9,630  
    Base management fee     5,604       3,424       10,868       6,375  
    General and administrative expenses     1,200       1,255       2,400       2,243  
    Administrative services expenses     650       585       1,150       1,211  
    Expenses before amendment costs and provision for taxes     36,241       24,719       73,058       43,089  
    Provision for taxes on net investment income     225       547       450       701  
    Credit Facility amendment costs     442             442        
    Total expenses     36,908       25,266       73,950       43,790  
    Net investment income     25,030       19,088       54,997       38,537  
    Realized and unrealized gain (loss) on investments and debt:                        
    Net realized gain (loss) on:                        
    Non-controlled, non-affiliated investments     (795 )     4,010       386       921  
    Non-controlled and controlled, affiliated investments     (2,682 )           22,811        
    Provision for taxes on realized gain (loss) on investments     (21 )           (94 )      
    Net realized gain (loss) on investments     (3,498 )     4,010       23,103       921  
    Net change in unrealized appreciation (depreciation) on:                        
    Non-controlled, non-affiliated investments     (9,630 )     3,278       (6,688 )     8,506  
    Controlled and non-controlled, affiliated investments     (11,146 )     4,466       (43,050 )     5,408  
    Provision for taxes on unrealized appreciation (depreciation) on investments     468       230       1,100       230  
    Debt appreciation (depreciation)     1       39       91       (23 )
    Net change in unrealized appreciation (depreciation) on investments and debt     (20,307 )     8,013       (48,547 )     14,121  
    Net realized and unrealized gain (loss) from investments and debt     (23,805 )     12,023       (25,444 )     15,042  
    Net increase (decrease) in net assets resulting from operations   $ 1,225     $ 31,111     $ 29,553     $ 53,579  
    Net increase (decrease) in net assets resulting from operations per common share   $ 0.01     $ 0.51     $ 0.34     $ 0.89  
    Net investment income per common share   $ 0.28     $ 0.31     $ 0.64     $ 0.64  

    ABOUT PENNANTPARK FLOATING RATE CAPITAL LTD.

    PennantPark Floating Rate Capital Ltd. is a business development company which primarily invests in U.S. middle-market companies in the form of floating rate senior secured loans, including first lien secured debt, second lien secured debt and subordinated debt. From time to time, the Company may also invest in equity investments. PennantPark Floating Rate Capital Ltd. is managed by PennantPark Investment Advisers, LLC.

    ABOUT PENNANTPARK INVESTMENT ADVISERS, LLC

    PennantPark Investment Advisers, LLC is a leading middle-market credit platform, managing approximately $10 billion of investable capital, including potential leverage. Since its inception in 2007, PennantPark Investment Advisers, LLC has provided investors access to middle-market credit by offering private equity firms and their portfolio companies as well as other middle-market borrowers a comprehensive range of creative and flexible financing solutions. PennantPark Investment Advisers, LLC is headquartered in Miami and has offices in New York, Chicago, Houston, Los Angeles, and Amsterdam.

    FORWARD-LOOKING STATEMENTS AND OTHER

    This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports we file under the Exchange Act. All statements other than statements of historical facts included in this press release are forward-looking statements and are not guarantees of future performance or results, and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the Securities and Exchange Commission. PennantPark Floating Rate Capital Ltd. undertakes no duty to update any forward-looking statement made herein. You should not place undue influence on such forward-looking statements as such statements speak only as of the date on which they are made.

    We may use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations.

    The information contained herein is based on current tax laws, which may change in the future. The Company cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in this material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.

    CONTACT: Richard T. Allorto, Jr.
      PennantPark Floating Rate Capital Ltd.
      (212) 905-1000
      www.pennantpark.com

    The MIL Network

  • MIL-OSI: Middlefield Banc Corp. Announces 2025 Second-Quarter Cash Dividend Payment

    Source: GlobeNewswire (MIL-OSI)

    MIDDLEFIELD, Ohio, May 12, 2025 (GLOBE NEWSWIRE) — Middlefield Banc Corp. (NASDAQ: MBCN) today announced that its Board of Directors declared a quarterly cash dividend of $0.21 per common share. The 2025 second-quarter dividend is payable on June 13, 2025, to shareholders of record on May 30, 2025.

    About Middlefield Banc Corp.
    Middlefield Banc Corp., headquartered in Middlefield, Ohio, is the Bank holding Company of The Middlefield Banking Company, with total assets of $1.89 billion at March 31, 2025. The Bank operates 21 full-service banking centers and an LPL Financial® brokerage office serving Ada, Beachwood, Bellefontaine, Chardon, Cortland, Dublin, Garrettsville, Kenton, Mantua, Marysville, Middlefield, Newbury, Orwell, Plain City, Powell, Solon, Sunbury, Twinsburg, and Westerville. The Bank also operates a Loan Production Office in Mentor, Ohio.

    Additional information is available at www.middlefieldbank.bank

    This press release of Middlefield Banc Corp. and the reports Middlefield Banc Corp. files with the Securities and Exchange Commission often contain “forward-looking statements” relating to present or future trends or factors affecting the banking industry and, specifically, the financial operations, markets and products of Middlefield Banc Corp. These forward-looking statements involve certain risks and uncertainties. There are a number of important factors that could cause Middlefield Banc Corp.’s future results to differ materially from historical performance or projected performance. These factors include, but are not limited to: (1) a significant increase in competitive pressures among financial institutions; (2) changes in the interest rate environment that may reduce interest margins; (3) changes in prepayment speeds, charge-offs and loan loss provisions; (4) less favorable than expected general economic conditions; (5) legislative or regulatory changes that may adversely affect businesses in which Middlefield Banc Corp. is engaged; (6) technological issues which may adversely affect Middlefield Banc Corp.’s financial operations or customers; (7) changes in the securities markets; or (8) risk factors mentioned in the reports and registration statements Middlefield Banc Corp. files with the Securities and Exchange Commission. Middlefield Banc Corp. undertakes no obligation to release revisions to these forward-looking statements or to reflect events or circumstances after the date of this press release.

    Company Contact: Investor and Media Contact:
    Ron Zimmerly
    President and Chief Executive Officer Middlefield Banc Corp.
    (419) 673-1217
    RZimmerly@middlefieldbank.com
    Andrew M. Berger
    Managing Director
    SM Berger & Company, Inc.
    (216) 464-6400
    andrew@smberger.com

    The MIL Network

  • MIL-OSI: Runway Growth Finance Corp. Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    Delivered Total and Net Investment Income of $35.4 million and $15.6 million, Respectively

    Investment Portfolio of $1.0 billion

    Conference Call Today, Monday, May 12, 2025 at 5:00 p.m. ET

    MENLO PARK, Calif., May 12, 2025 (GLOBE NEWSWIRE) — Runway Growth Finance Corp. (Nasdaq: RWAY) (“Runway Growth” or the “Company”), a leading provider of flexible capital solutions to late- and growth-stage companies seeking an alternative to raising equity, today announced its financial results for the first quarter ended March 31, 2025.

    First Quarter 2025 Highlights

    • Total investment income of $35.4 million
    • Net investment income of $15.6 million, or $0.42 per share
    • Net asset value of $503.3 million, or $13.48 per share
    • Dollar-weighted annualized yield on debt investments of 15.44%
    • Three investments completed in existing portfolio companies, representing $50.7 million in funded investments
    • Aggregate proceeds of $71.9 million in principal prepayments and $3.7 million from scheduled amortization
    • Aggregate proceeds of $38.1 million in equity sale proceeds, resulting in net realized gains of $7.4 million
    • Total net realized gains on investments of $6.1 million

    Second Quarter 2025 Distributions

    • Declared second quarter 2025 regular dividend of $0.33 per share
    • Declared second quarter 2025 supplemental dividend of $0.02 per share

    “In the first quarter of 2025, Runway Growth advanced its platform strategy, enhancing origination channels as we seek to maximize our portfolio,” said David Spreng, Founder and CEO of Runway Growth. “For the first quarter, we delivered net investment income of $15.6 million, comfortably covered our quarterly distributions, and executed on three investments in existing portfolio companies. As officially part of the broader BC Partners platform, we believe we have ample liquidity to move both opportunistically and selectively when the right investments arise. Looking ahead, we are well positioned to optimize our portfolio while maintaining credit-first underwriting practices as we deliver strong returns for our shareholders.”

    First Quarter 2025 Operating Results

    Total investment income for the quarter ended March 31, 2025 was $35.4 million, compared to $40.0 million for the quarter ended March 31, 2024.

    Net investment income for the quarter ended March 31, 2025 was $15.6 million, or $0.42 per share, compared to $18.7 million, or $0.46 per share, for the quarter ended March 31, 2024.

    The Company’s dollar-weighted annualized yield on average debt investments for the quarter ended March 31, 2025 was 15.4%. The Company calculates the yield on dollar-weighted debt investments for any period measured as (1) total investment-related income during the period divided by (2) the daily average of the fair value of debt investments, including investments on non-accrual status, outstanding during the period.

    Total operating expenses for the quarter ended March 31, 2025 were $19.8 million, compared to $21.3 million for the quarter ended March 31, 2024.

    Net realized gain on investments was $6.1 million for the quarter ended March 31, 2025, compared to no net realized gains or losses for the quarter ended March 31, 2024.

    For the quarter ended March 31, 2025, net change in unrealized loss on investments was $19.8 million, compared to a net change in unrealized loss on investments of $6.6 million for the comparable prior year period.

    Portfolio and Investment Activity

    As of March 31, 2025, Runway Growth’s investment portfolio had an aggregate fair value of $1.0 billion in 52 companies, comprising $946.4 million in term loans, 97.9% of which are senior secured loans, and $57.8 million in warrants and other equity-related investments.

    During the first quarter of 2025, Runway Growth funded three investments in existing portfolio companies, representing $15.3 million in funded loans, which is net of refinances of $35.0 million and upfront loan origination fees of $0.4 million.

    Total portfolio investment activity for the three months ended March 31, 2025 and 2024 was as follows:

         
      Three Months Ended March 31,  
         
      2025     2024  
    Beginning investment portfolio $ 1,076,840     $ 1,067,009  
    Purchases of investments   15,320       24,642  
    PIK interest   3,260       4,176  
    Sales and prepayments of investments   (74,978 )     (34,449 )
    Scheduled repayments of investments   (3,665 )     (413 )
    Sales and maturities of U.S. Treasury Bills         (42,029 )
    Amortization of fixed income premiums or accretion of discounts   1,189       4,013  
    Net realized gain (loss) on investments   6,057        
    Net change in unrealized gain (loss) on investments   (19,790 )     (6,617 )
    Ending investment portfolio $ 1,004,233     $ 1,016,332  
                   

    Net Asset Value

    As of March 31, 2025, net asset value per share was $13.48, compared to $13.36 as of March 31, 2024. Total net assets at the end of the first quarter of 2025 was $503.3 million, down 4.9% from $529.5 million as of March 31, 2024.

    For the quarter ended March 31, 2025, our net increase in net assets resulting from operations was $1.9 million, or $0.05 per share, compared to a net increase in net assets resulting from operations of $12.0 million, or $0.30 per share, for the quarter ended March 31, 2024.

    Liquidity and Capital Resources

    As of March 31, 2025, the Company had approximately $315.4 million in available liquidity, including unrestricted cash and cash equivalents of $18.4 million and $297.0 million in available borrowing capacity under the Company’s credit facility, subject to existing terms, advance rates and regulatory and covenant requirements.

    The Company ended the quarter with a core leverage ratio of approximately 99%, compared to 108% for the quarter ended December 31, 2024.

    Distributions

    On May 7, 2025, the Company’s board of directors (the “Board of Directors”) declared a regular quarterly distribution of $0.33 per share and a supplemental distribution of $0.02 per share for stockholders of record as of May 19, 2025, each payable on June 3, 2025.

    Recent Developments

    The Company evaluated events subsequent to March 31, 2025 through May 12, 2025, the date the consolidated financial statements were issued. There have been no subsequent events that occurred during such period that would require recognition or disclosure, except as disclosed below.

    Borrowings

    On April 7, 2025, the Company entered into the Master Note Purchase Agreement, dated April 7, 2025 (the “Note Purchase Agreement”), governing the issuance of 7.51% Series 2025A Senior Notes due April 7, 2028 (the “Series 2025A Notes”), in aggregate principal amount of $107.0 million, to institutional investors in a private placement.

    The Series 2025A Notes have a fixed interest rate of 7.51% per year. The Company used the net proceeds from the offering of the Series 2025A Notes to repay outstanding indebtedness, make investments in accordance with the Company’s investment objective and investment strategy, and for other general corporate purposes of the Company.

    The Series 2025A Notes will mature on April 7, 2028 unless redeemed, purchased or prepaid prior to such date by the Company in accordance with the terms of the Note Purchase Agreement. Interest on the Series 2025A Notes will be due semiannually on April 7 and October 7 of each year, beginning on October 7, 2025. In addition, the Company is obligated to offer to repay the Series 2025A Notes at par (plus accrued and unpaid interest to, but not including, the date of prepayment) if certain change in control events occur. Subject to the terms of the Note Purchase Agreement, so long as no Default or Event of Default (each as defined in the Note Purchase Agreement) shall then exist, at any time on or after October 7, 2027, the Company may, at its option, prepay all or any part of the 2025A Notes at 100% of the principal amount so prepaid, together with, in each case, accrued interest to the prepayment date.

    The Note Purchase Agreement contains customary terms and conditions for senior notes issued in a private placement, including, without limitation, affirmative and negative covenants related to information reporting, maintenance of the Company’s status as a business development company within the meaning of the Investment Company Act of 1940, as amended, and a regulated investment company under the Internal Revenue Code of 1986, as amended, minimum shareholders’ equity, minimum asset coverage ratio and maximum secured debt ratio. The Note Purchase Agreement also contains customary events of default with customary cure and notice periods.

    Recent Portfolio Activity

    From April 1, 2025 through May 12, 2025, the Company completed $40.0 million of additional debt commitments, of which $27.0 million was funded upon closing.

    Share Repurchase Program

    On May 7, 2025, the Board of Directors approved a repurchase program (the “New Repurchase Program”) under which the Company may repurchase up to $25.0 million of its outstanding common stock. Under the New Repurchase Program, purchases may be made at management’s discretion from time to time in open-market transactions, in accordance with all applicable securities laws and regulations. If not renewed, the New Repurchase Program will terminate upon the earlier of (i) May 7, 2026 or (ii) the repurchase of $25.0 million of the Company’s outstanding shares of common stock.

    Conference Call

    Runway Growth will hold a conference call to discuss its first quarter ended March 31, 2025 financial results at 2:00 p.m. PT (5:00 p.m. ET) on Monday, May 12, 2025. To participate in the conference call or webcast, participants should register online at the Runway Investor Relations website. The earnings call can also be accessed through the following links:

    A live webcast will be available in the investor section of the Company’s website, and will be archived for 90 days following the call.

    About Runway Growth Finance Corp.

    Runway Growth is a growing specialty finance company focused on providing flexible capital solutions to late- and growth-stage companies seeking an alternative to raising equity. Runway Growth is a closed-end investment fund that has elected to be regulated as a business development company under the Investment Company Act of 1940, as amended. Runway Growth is externally managed by Runway Growth Capital LLC, an established registered investment advisor that was formed in 2015 and led by industry veteran David Spreng. For more information, please visit www.runwaygrowth.com.

    Forward-Looking Statements

    Statements included herein may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Statements other than statements of historical facts included in this press release may constitute forward-looking statements and are not guarantees of future performance, condition or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in Runway Growth’s filings with the Securities and Exchange Commission. Runway Growth undertakes no duty to update any forward-looking statement made herein. All forward-looking statements speak only as of the date of this press release.

    Important Disclosures

    Strategies described involve special risks that should be evaluated carefully before a decision is made to invest. Not all of the risks and other significant aspects of these strategies are discussed herein.  Please see a more detailed discussion of these risk factors and other related risks in the Company’s most recent annual report on Form 10-K in the section entitled “Risk Factors”, and in the Company’s quarterly report on Form 10-Q for the quarter ended March 31, 2025, which may be obtained on the Company’s website, www.runwaygrowth.com, or the SEC’s website, www.sec.gov

    IR Contacts:

    Taylor Donahue, Prosek Partners, tdonahue@prosek.com 

    Thomas B. Raterman, Chief Financial Officer and Chief Operating Officer, tr@runwaygrowth.com 

    RUNWAY GROWTH FINANCE CORP.
    Consolidated Statements of Assets and Liabilities
    (In thousands, except share and per share data)
     
      March 31, 2025   December 31, 2024  
        (Unaudited)      
    Assets            
    Investments at fair value:            
    Non-control/non-affiliate investments at fair value (cost of $1,039,965 and $1,038,135, respectively) $ 997,359   $ 1,005,328  
    Affiliate investments at fair value (cost of $4,551 and $59,198, respectively)       64,572  
    Control investments at fair value (cost of $6,550 and $6,550, respectively)   6,874     6,940  
    Total investments at fair value (cost of $1,051,066 and $1,103,883, respectively)   1,004,233     1,076,840  
    Cash and cash equivalents   18,356     5,751  
    Interest and fees receivable   8,730     8,141  
    Other assets   1,577     623  
    Total assets   1,032,896     1,091,355  
    Liabilities            
    Debt:            
    Credit facility   253,000     311,000  
    2026 Notes   95,000     95,000  
    2027 Notes   152,250     152,250  
    Unamortized deferred financing costs   (8,043 )   (5,918 )
    Total debt, less unamortized deferred financing costs   492,207     552,332  
    Distributions payable   13,445      
    Incentive fees payable   14,045     14,106  
    Interest payable   7,656     7,743  
    Accrued expenses and other liabilities   2,253     2,305  
    Total liabilities   529,606     576,486  
    Net assets            
    Common stock, par value   373     373  
    Additional paid-in capital   557,992     557,992  
    Accumulated undistributed (overdistributed) earnings   (55,075 )   (43,496 )
    Total net assets $ 503,290   $ 514,869  
                 
    Shares of common stock outstanding ($0.01 par value, 100,000,000 shares authorized)   37,347,428     37,347,428  
    Net asset value per share $ 13.48   $ 13.79  
    RUNWAY GROWTH FINANCE CORP.
    Consolidated Statements of Operations
    (Unaudited)
    (In thousands, except share and per share data)
     
       
      Three Months Ended March 31,  
      2025   2024  
    Investment income            
    From non-control/non-affiliate investments:            
    Interest income $ 30,109   $ 34,455  
    Payment-in-kind interest income   3,651     4,207  
    Dividend income   318      
    Fee income   229     620  
    From affiliate investments:            
    Interest income   646     599  
    Fee income   256      
    Other income   189     128  
    Total investment income   35,398     40,009  
    Operating expenses            
    Management fees   4,009     3,952  
    Incentive fees   3,929     4,668  
    Interest and other debt financing expenses   10,287     10,860  
    Professional fees   454     662  
    Administration agreement expenses   625     564  
    Insurance expense   155     208  
    Tax expense   110     2  
    Other expenses   230     429  
    Total operating expenses   19,799     21,345  
    Net investment income   15,599     18,664  
    Net realized and net change in unrealized gain (loss) on investments            
    Net realized gain (loss) on non-control/non-affiliate investments   (2,886 )    
    Net realized gain (loss) on affiliate investments   8,943      
    Net realized gain (loss) on investments   6,057      
    Net change in unrealized gain (loss) on non-control/non-affiliate investments   (9,799 )   (5,065 )
    Net change in unrealized gain (loss) on affiliate investments   (9,925 )   (1,552 )
    Net change in unrealized gain (loss) on control investments   (66 )    
    Net change in unrealized gain (loss) on investments   (19,790 )   (6,617 )
    Net realized and unrealized gain (loss) on investments   (13,733 )   (6,617 )
    Net increase (decrease) in net assets resulting from operations $ 1,866   $ 12,047  
    Net investment income per common share (basic and diluted) $ 0.42   $ 0.46  
    Net increase (decrease) in net assets resulting from operations per common share (basic and diluted) $ 0.05   $ 0.30  
    Weighted average shares outstanding (basic and diluted)   37,347,428     40,392,255  

    The MIL Network

  • MIL-OSI: Rigetti Computing Reports First Quarter 2025 Financial Results

    Source: GlobeNewswire (MIL-OSI)

    BERKELEY, Calif., May 12, 2025 (GLOBE NEWSWIRE) — Rigetti Computing, Inc. (Nasdaq: RGTI) (“Rigetti” or the “Company”), a pioneer in full-stack quantum-classical computing, today announced its financial results for the first quarter ended March 31, 2025.

    First Quarter 2025 and Recent Financial Highlights

    • Total revenues for the three months ended March 31, 2025 were $1.5 million
    • Total operating expenses for the three months ended March 31, 2025 were $22.1 million
    • Operating loss for the three months ended March 31, 2025 was $21.6 million
    • Net income for the three months ended March 31, 2025 was $42.6 million
    • Net income for the three months ended March 31, 2025 includes $62.1 million of non-cash gains from the change in fair value of derivative warrant and earn-out liabilities
    • As of March 31, 2025 cash, cash equivalents and available-for-sale investments totaled $209.1 million
    • As of April 30, 2025, following the previously announced closing of the share purchase by Quanta Computer, Inc., cash, cash equivalents and available-for-sale investments totaled $237.7 million

    “Rigetti is proud to be awarded important government-funded projects in the U.S. and U.K. to advance our technology, which demonstrates our continued leadership in superconducting quantum computing,” says Rigetti CEO Dr. Subodh Kulkarni. “We also are making great strides in developing innovative approaches to scaling to higher qubit count systems, which is possible due to our open and modular system architecture, in-house full-stack expertise, and world-class partners.”

    Recent Business Developments

    Rigetti Selected to Participate in DARPA’s Quantum Benchmarking Initiative
    Rigetti will advance to Stage A, a 6-month performance period focused on the Company’s utility-scale quantum computer concept worth up to $1 million upon completion of program milestones. Rigetti’s proposed concept to design and build a Utility-Scale Quantum Computer (USQC) combines the Company’s proprietary multi-chip architecture with scalable quantum error correction (QEC) codes. Rigetti’s long-time partner and leader in QEC technology, Riverlane, will be collaborating on this project and bringing their expertise to help refine the proposed USQC concept and validate the underlying technology.

    Rigetti Granted AFOSR Award to Further Develop Breakthrough Chip Fabrication Technology
    Rigetti will lead a $5.48 million consortium to further develop its breakthrough chip fabrication technology, Alternating-Bias Assisted Annealing (ABAA). Rigetti will collaborate with Iowa State University, the Royal Melbourne Institute of Technology, the University of Connecticut, and Lawrence Livermore National Laboratory* to develop a detailed understanding of how ABAA impacts the chip on a microscopic level — which aims to shed light on defects in superconducting qubits and open new avenues for understanding and mitigating them.

    *Funded separately though Laboratory for Physical Sciences, University of Maryland

    Rigetti Awarded Three Innovate UK Quantum Mission Pilot Awards to Advance Superconducting Quantum Computing
    Rigetti will lead a £3.5 million consortium to advance quantum error correction capabilities on superconducting quantum computers. In collaboration with Riverlane and the National Quantum Computing Centre (NQCC) Superconducting Circuits Team, the consortium will conduct ambitious QEC tests that advance state-of-the-art metrics and demonstrate real-time QEC capabilities — a requirement for universal, fault-tolerant quantum computing.

    As part of the project, Rigetti will also upgrade its existing NQCC quantum computer. The upgrades will include:

    • Deploying a larger 36-qubit quantum processing unit (QPU), updating from the current 24-qubit QPU
    • Integrating Rigetti’s latest generation control system, enabling improved qubit control and a fully programmable, low-latency interface with Riverlane’s QEC Stack

    Rigetti was also awarded two additional Quantum Missions pilot competition projects:

    • Collaboration with SEEQC to integrate its digital chip-based technology with Rigetti’s 9-qubit Novera™ QPU hosted at the NQCC with the goal of identifying and understanding the key system components needed for scalable QEC.
    • Collaboration with TreQ, Qruise, Q-CTRL, and Oxford Ionics aims to create an open-architecture quantum computing testbed and deliver an open specification for quantum workflows, creating a common interface between quantum software and hardware.

    Rigetti Closes Investment by Quanta Computer
    On April 29, 2025, Rigetti closed its previously announced investment by Quanta Computer Inc. related to our strategic collaboration agreement. In connection with the closing, Quanta purchased approximately $35 million of shares of Rigetti common stock at approximately $11.59 per share.

    Recent Technical Updates

    Controlling a Superconducting Qubit Using Optical Signals
    Rigetti’s joint paper with Harvard University, Massachusetts Institute of Technology, and University of Chicago, “Coherent control of a superconducting qubit using light,” has been published in Nature Physics.

    Fault-tolerant quantum computing will likely require 10,000 to a million physical qubits. Scaling these systems is challenging because they require bulky microwave components with high thermal loads that can quickly overwhelm the cooling power of a dilution refrigerator. Optical signals have a considerably smaller footprint and negligible thermal conductivity.

    The team successfully demonstrated the integration of a hybrid microwave-optical quantum transducer with a Rigetti-fabricated superconducting qubit. This hybrid set-up enables optical control of the qubit, removing the need for coax lines and provides a promising approach to scaling to higher qubit count systems.

    New Quantum Algorithm Boosts Classical Optimizers
    Rigetti leveraged its new quantum optimization algorithm, quantum preconditioning, to address a power energy grid problem. Using a public dataset representing South Carolina’s energy grid, the problem was to compute the maximum power exchange section, a metric that informs on the health and the power delivery capability of the energy network. Using Rigetti’s 84-qubit Ankaa-3 system, quantum preconditioning was used to boost best-in-class classical optimizers. A relative advantage against the classical baseline was achieved along with a high solution accuracy, highlighting the potential for quantum preconditioning to achieve quantum utility for solving practical optimization problems.

    Conference Call and Webcast
    Rigetti will host a conference call later today, May 12, 2025, at 5:00 pm ET, or 2:00 pm PT, to discuss its first quarter 2025 financial results.

    You can listen to a live audio webcast of the conference call at https://edge.media-server.com/mmc/p/5w8qggnn/ or the “Events & Presentations” section of the Company’s Investor Relations website at https://investors.rigetti.com/. A replay of the conference call will be available at the same locations following the conclusion of the call for one year.

    To participate in the live call, you must register using the following link: https://register-conf.media-server.com/register/BIa01e2c81dc8f4031b25c1ce89653b15e. Once registered, you will receive dial-in numbers and a unique PIN number. When you dial in, you will input your PIN and be routed into the call. If you register and forget your PIN, or lose the registration confirmation email, simply re-register to receive a new PIN.

    About Rigetti
    Rigetti is a pioneer in full-stack quantum computing. The Company has operated quantum computers over the cloud since 2017 and serves global enterprise, government, and research clients through its Rigetti Quantum Cloud Services platform. In 2021, Rigetti began selling on-premises quantum computing systems with qubit counts between 24 and 84 qubits, supporting national laboratories and quantum computing centers. Rigetti’s 9-qubit Novera QPU was introduced in 2023 supporting a broader R&D community with a high-performance, on-premises QPU designed to plug into a customer’s existing cryogenic and control systems. The Company’s proprietary quantum-classical infrastructure provides high-performance integration with public and private clouds for practical quantum computing. Rigetti has developed the industry’s first multi-chip quantum processor for scalable quantum computing systems. The Company designs and manufactures its chips in-house at Fab-1, the industry’s first dedicated and integrated quantum device manufacturing facility. Learn more at https://www.rigetti.com/.

    Contacts
    Rigetti Computing Investor Contact:
    IR@Rigetti.com

    Rigetti Computing Media Contact:
    press@rigetti.com

    Cautionary Language Concerning Forward-Looking Statements
    Certain statements in this communication may be considered “forward-looking statements” within the meaning of the federal securities laws, including statements with respect to the Company’s future success and performance, including expectations with respect to timing of the development and commercialization of superconducting quantum computing; expectations regarding the advantages and impact of the government-funded projects on the Company’s operations, technology roadmap, milestones, and the Company’s position in the industry; statements to the development of innovative approaches to scaling to higher qubit count systems and the impact of our open and modular system architecture, in-house full-stack expertise, and world-class partners; expectations for work under the AFOSR Award to shed light on defects in superconducting qubits and open new avenues for understanding and mitigating them; and expectations for the Quantum Missions pilot competition projects to: (a) lead to identifying and understanding key system components needed for scalable QEC, and (b) create an open-architecture quantum computing testbed and deliver an open specification for quantum workflows, creating a common interface between quantum software and hardware. These forward-looking statements are based upon estimates and assumptions that, while considered reasonable by the Company and its management, are inherently uncertain. Factors that may cause actual results to differ materially from current expectations include, but are not limited to: the Company’s ability to achieve milestones, technological advancements, including with respect to its technology roadmap; the ability of the Company to obtain government contracts successfully and in a timely manner and the availability of government funding; the potential of quantum computing; the success of the Company’s partnerships and collaborations, including the strategic collaboration with Quanta; the Company’s ability to accelerate its development of multiple generations of quantum processors; the outcome of any legal proceedings that may be instituted against the Company or others; the ability to maintain relationships with customers and suppliers and attract and retain management and key employees; costs related to operating as a public company; changes in applicable laws or regulations; the possibility that the Company may be adversely affected by other economic, business, or competitive factors; the Company’s estimates of expenses and profitability; the evolution of the markets in which the Company competes; the ability of the Company to implement its strategic initiatives and expansion plans; the expected use of proceeds from the Company’s past and future financings or other capital; the sufficiency of the Company’s cash resources; unfavorable conditions in the Company’s industry, the global economy or global supply chain, including rising inflation and interest rates, deteriorating international trade relations, political turmoil, natural catastrophes, warfare and terrorist attacks; and other risks and uncertainties set forth in the section entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 and Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and other documents filed by the Company from time to time with the SEC. These filings identify and address other important risks and uncertainties that could cause actual events and results to differ materially from those contained in the forward-looking statements. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and the Company assumes no obligation and does not intend to update or revise these forward-looking statements other than as required by applicable law. The Company does not give any assurance that it will achieve its expectations.

     
    RIGETTI COMPUTING, INC.
    CONDENSED CONSOLIDATED BALANCE SHEETS
    (in thousands, except number of shares and par value)
    (unaudited)
                 
        March 31,   December 31,
        2025   2024
    Assets            
    Current assets:            
    Cash and cash equivalents   $ 37,162     $ 67,674  
    Available-for-sale investments – short-term     171,966       124,420  
    Accounts receivable     1,068       2,427  
    Prepaid expenses     2,124       3,156  
    Other current assets     2,041       9,081  
    Total current assets     214,361       206,758  
    Available-for-sale investments – long-term           25,068  
    Property and equipment, net     46,100       44,643  
    Operating lease right-of-use assets     7,609       7,993  
    Other assets     1,068       325  
    Total assets   $ 269,138     $ 284,787  
                 
    Liabilities and Stockholders’ Equity            
    Current liabilities:            
    Accounts payable   $ 3,401     $ 1,590  
    Accrued expenses and other current liabilities     5,665       8,005  
    Current portion of deferred revenue     147       113  
    Current portion of operating lease liabilities     2,179       2,159  
    Total current liabilities     11,392       11,867  
    Deferred revenue, less current portion     698       698  
    Operating lease liabilities, less current portion     6,230       6,641  
    Derivative warrant liabilities     39,576       93,095  
    Earn-out liabilities     4,114       45,897  
    Total liabilities     62,010       158,198  
    Commitments and contingencies            
    Stockholders’ equity:            
    Preferred stock, par value $0.0001 per share, 10,000,000 shares authorized, none outstanding            
    Common stock, par value $0.0001 per share, 1,000,000,000 shares authorized, 286,974,947 shares issued and outstanding at March 31, 2025 and 283,546,871 shares issued and outstanding at December 31, 2024     29       29  
    Additional paid-in capital     719,315       681,202  
    Accumulated other comprehensive (loss) income     (88 )     105  
    Accumulated deficit     (512,128 )     (554,747 )
    Total stockholders’ equity     207,128       126,589  
    Total liabilities and stockholders’ equity   $ 269,138     $ 284,787  
                     
     
    RIGETTI COMPUTING, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    (in thousands, except per share data)
    (unaudited)
         
        Three months ended March 31,
        2025 2024
    Revenue   $ 1,472     $ 3,052  
    Cost of revenue     1,030       1,552  
    Total gross profit     442       1,500  
    Operating expenses:            
    Research and development     15,455       11,471  
    Selling, general and administrative     6,619       6,614  
    Total operating expenses     22,074       18,085  
    Loss from operations     (21,632 )     (16,585 )
    Other income (expense), net            
    Interest expense           (1,107 )
    Interest income     2,152       1,123  
    Change in fair value of derivative warrant liabilities     53,262       (2,583 )
    Change in fair value of earn-out liabilities     8,837       (1,621 )
    Total other income (expense), net     64,251       (4,188 )
    Net income (loss) before provision for income taxes     42,619       (20,773 )
    Provision for income taxes            
    Net income (loss)   $ 42,619     $ (20,773 )
    Net income (loss) available to common stockholders used in diluted earnings per share   $ 38,256     $ (20,773 )
    Net income (loss) per share attributable to common stockholders – basic   $ 0.15     $ (0.14 )
    Net income (loss) per share attributable to common stockholders – diluted   $ 0.13     $ (0.14 )
    Weighted average shares used to compute net income (loss) per share attributable to common stockholders – basic     284,698       151,855  
    Weighted average shares used to compute net income (loss) per share attributable to common stockholders – diluted     301,595       151,855  
                     
     
    RIGETTI COMPUTING INC.
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands)
    (unaudited)
         
        Three months ended March 31,
        2025   2024
    Cash flows from operating activities:            
    Net income (loss)   $ 42,619     $ (20,773 )
    Adjustments to reconcile net income (loss) to net cash used in operating activities:            
    Depreciation and amortization     1,829       1,787  
    Stock-based compensation     4,174       2,991  
    Change in fair value of earn-out liabilities     (8,837 )     1,621  
    Change in fair value of derivative warrant liabilities     (53,262 )     2,583  
    Accretion of available-for-sale securities     (1,423 )     (855 )
    Amortization of debt issuance costs, commitment fees and accretion of final payment fees           298  
    Non-cash lease expense     384       391  
    Changes in operating assets and liabilities:            
    Accounts receivable     1,359       323  
    Prepaid expenses, other current assets and other assets     1,379       435  
    Deferred revenue     34       (214 )
    Accounts payable     747       334  
    Accrued expenses and operating lease liabilities     (2,654 )     (2,060 )
    Net cash used in operating activities     (13,651 )     (13,139 )
    Cash flows from investing activities:            
    Purchases of property and equipment     (2,547 )     (5,493 )
    Purchases of available-for-sale securities     (44,062 )     (27,287 )
    Maturities of available-for-sale securities     23,000       39,000  
    Net cash (used in) provided by investing activities     (23,609 )     6,220  
    Cash flows from financing activities:            
    Payments of principal of notes payable           (3,045 )
    Proceeds from sale of common stock through Common Stock Purchase Agreement           12,838  
    Proceeds from sale of common stock through At-The-Market (ATM) Offering           11,031  
    Payments of offering costs     (73 )     (174 )
    Net proceeds from tax withholdings on sell-to-cover equity award transactions     6,272        
    Proceeds from issuance of common stock upon exercise of stock options     327       60  
    Proceeds from issuance of common stock upon exercise of warrants     409        
    Net cash provided by financing activities     6,935       20,710  
    Effects of exchange rate changes on cash and cash equivalents     (187 )     (85 )
    Net (decrease) increase in cash and cash equivalents     (30,512 )     13,706  
    Cash and cash equivalents – beginning of period     67,674       21,392  
    Cash and cash equivalents – end of period   $ 37,162     $ 35,098  
    Supplemental disclosures of other cash flow information:            
    Cash paid for interest   $     $ 811  
    Non-cash investing and financing activities:            
    Capitalization of deferred costs to equity upon share issuance           52  
    Purchases of property and equipment recorded in accounts payable     1,408       1,115  
    Purchases of property and equipment recorded in accrued expenses     74        
    Reclassification of earn-out liabilities to additional paid-in capital for vesting of Promote Sponsor Vesting Shares     32,946        
    Reclassification of derivative liabilities to additional paid-in capital due to exercise of Public Warrants     257        
    Purchases of deferred offering costs in accounts payable     122       273  
    Unrealized losses on short term investments     (8 )     (18 )
                     

    The MIL Network

  • MIL-OSI: PennantPark Investment Corporation Announces Financial Results for the Quarter Ended March 31, 2025

    Source: GlobeNewswire (MIL-OSI)

    MIAMI, May 12, 2025 (GLOBE NEWSWIRE) — PennantPark Investment Corporation (NYSE: PNNT) announced today its financial results for the second quarter ended March 31, 2025.

    HIGHLIGHTS       
    Quarter ended March 31, 2025 (unaudited)
    ($ in millions, except per share amounts)                           

    Assets and Liabilities:    
    Investment portfolio (1) $ 1,213.6  
    Net assets $ 488.1  
    GAAP net asset value per share $ 7.48  
    Quarterly change in GAAP net asset value per share   (1.2 )%
    Adjusted net asset value per share (2) $ 7.48  
    Quarterly change in adjusted net asset value per share (2)   (1.2 )%
         
    Credit Facility $ 311.4  
    2026 Notes $ 149.0  
    2026-2 Notes $ 163.5  
    Regulatory debt to equity 1.29x  
    Weighted average yield on debt investments   12.0 %
         
    Operating Results:    
    Net investment income $ 11.4  
    Net investment income per share $ 0.18  
    Core net investment income per share (3) $ 0.18  
    Distributions declared per share $ 0.24  
         
    Portfolio Activity:    
    Purchases of investments * $ 176.8  
    Sales and repayments of investments * $ 263.1  
         
    PSLF Portfolio data:    
    PSLF investment portfolio $ 1,392.9  
    Purchases of investments $ 169.9  
    Sales and repayments of investments $ 48.3  
           

    * excludes U.S. Government Securities

    1. Includes investments in PennantPark Senior Loan Fund, LLC (“PSLF”), an unconsolidated joint venture, totaling $217.7 million, at fair value.
    2. This is a non-GAAP financial measure. The Company believes that this number provides useful information to investors and management because it reflects the Company’s financial performance excluding the impact of unrealized gain on the Company’s multi-currency, senior secured revolving credit facility with Truist Bank, as amended, the “Credit Facility.” The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP.
    3. Core net investment income (“Core NII”) is a non-GAAP financial measure. The Company believes that Core NII provides useful information to investors and management because it reflects the Company’s financial performance excluding one-time or non-recurring investment income and expenses. The presentation of this additional information is not meant to be considered in isolation or as a substitute for financial results prepared in accordance with GAAP. For the quarter ended March 31, 2025, Core NII excluded: i) $0.3 million of credit facility amendment cost, and ii) $0.1 million of incentive fee expense offset.

    CONFERENCE CALL AT 12:00 P.M. EST ON MAY 13, 2025

    PennantPark Investment Corporation (“we,” “our,” “us” or the “Company”) will also host a conference call at 12:00 p.m. (Eastern Time) on Tuesday, May 13, 2025 to discuss its financial results. All interested parties are welcome to participate. You can access the conference call by dialing toll-free (888) 394-8218 approximately 5-10 minutes prior to the call. International callers should dial (646) 828-8193. All callers should reference conference ID #1509093 or PennantPark Investment Corporation. An archived replay will also be available on a webcast link located on the Quarterly Earnings page in the Investor section of PennantPark’s website.

    PORTFOLIO AND INVESTMENT ACTIVITY 

    “We are pleased that our secured loan portfolio, with among the lowest portfolio company leverage and most meaningful covenants in the industry, is positioned defensively and continues to perform well,” said Art Penn, Chairman and CEO. “Additionally, our dividend stream is supported by substantial spillover income as we look to rotate equity investments over time.”

    As of March 31, 2025, our portfolio totaled $1,213.6 million and consisted of $503.0 million or 41% of first lien secured debt, $124.6 million or 10% of U.S. Government Securities, $17.9 million or 2% of second lien secured debt, $216.8 million or 18% of subordinated debt (including $140.3 million or 12% in PSLF) and $351.3 million or 29% of preferred and common equity (including $77.4 million or 6% in PSLF). Our interest bearing debt portfolio consisted of 91% variable-rate investments and 9% fixed-rate investments. As of March 31, 2025, we had three portfolio companies on non-accrual, representing 1.6% and 0.4% percent of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $40.7 million as of March 31, 2025. Our overall portfolio consisted of 158 companies with an average investment size of $6.9 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.0%.

    As of September 30, 2024, our portfolio totaled $1,328.1 million and consisted of $667.9 million or 50% of first lien secured debt, $99.6 million or 8% of U.S. Government Securities, $67.2 million or 5% of second lien secured debt, $181.7 million or 14% of subordinated debt (including $115.9 million or 9% in PSLF) and $311.7 million or 23% of preferred and common equity (including $67.9 million or 5% in PSLF). Our interest bearing debt portfolio consisted of 94% variable-rate investments and 6% fixed-rate investments. As of September 30, 2024, we had two portfolio companies on non-accrual, representing 4.1% and 2.3% of our overall portfolio on a cost and fair value basis, respectively. Overall, the portfolio had net unrealized appreciation of $11.2 million as of September 30, 2024. Our overall portfolio consisted of 152 companies with an average investment size of $8.1 million (excluding U.S. Government Securities), had a weighted average yield on interest bearing debt investments of 12.3%.

    For the three months ended March 31, 2025, we invested $176.8 million in three new and 52 existing portfolio companies with a weighted average yield on debt investments of 10.7% (excluding U.S. Government Securities). For the three months ended March 31, 2025, sales and repayments of investments totaled $263.1 million (including $154.4 million was sold to PSLF) which excludes U.S. Government Securities. For the six months ended March 31, 2025, we invested $472.5 million in 15 new and 96 existing portfolio companies with a weighted average yield on debt investments of 10.6% (excluding U.S. Government Securities). For the six months ended March 31, 2025, sales and repayments of investments totaled $616.8 million (including $441.0 million was sold to PSLF) which excludes U.S. Government Securities.

    For the three months ended March 31, 2024, we invested $188.5 million in six new and 43 existing portfolio companies with a weighted average yield on debt investments of 11.7% (excluding U.S. Government Securities). For the three months ended March 31, 2024, sales and repayments of investments totaled $176.2 million (including $103.1 million was sold to PSLF) which excludes U.S. Government Securities. For the six months ended March 31, 2024, we invested $419.6 million in 18 new and 60 existing portfolio companies with a weighted average yield on debt investments of 11.8% (excluding U.S. Government Securities). For the six months ended March 31, 2024, sales and repayments of investments totaled $247.2 million (including $154.0 million was sold to PSLF) which excludes U.S. Government Securities.
      
    PennantPark Senior Loan Fund, LLC

    As of March 31, 2025, PSLF’s portfolio totaled $1,392.9 million, consisted of 119 companies with an average investment size of $11.7 million and had a weighted average yield interest bearing debt investments of 10.4%.

    As of September 30, 2024, PSLF’s portfolio totaled $1,031.2 million, consisted of 102 companies with an average investment size of $10.1 million and had a weighted average yield interest bearing debt investments of 11.3%.

    For the three months ended March 31, 2025, PSLF invested $169.9 million (including $154.4 million were purchased from the Company) in eight new and 14 existing portfolio companies at weighted average yield interest bearing debt investments of 10.1%. PSLF’s sales and repayments of investments for the same period totaled $48.3 million. For the six months ended March 31, 2025, PSLF invested $523.7 million (including $441.0 million were purchased from the Company) in 23 new and 57 existing portfolio companies at weighted average yield interest bearing debt investments of 10.4%. PSLF’s sales and repayments of investments for the same period totaled $157.4 million.

    For the three months ended March 31, 2024, PSLF invested $113.2 million (including $103.1 million were purchased from the Company) in 11 new and five existing portfolio companies at weighted average yield on interest bearing debt investments of 11.8%. PSLF’s sales and repayments of investments for the same period totaled $49.7 million. For the six months ended March 31, 2024, PSLF invested $194.2 million (including $154.0 million were purchased from the Company) in 16 new and 11 existing portfolio companies at weighted average yield on interest bearing debt investments of 12.2%. PSLF’s sales and repayments of investments for the same period totaled $78.9 million.

    RESULTS OF OPERATIONS

    Set forth below are the results of operations for the three and six months ended March 31, 2025 and 2024.

    Investment Income

    For the three and six months ended March 31, 2025, investment income was $30.7 million and $64.9 million, respectively, which was attributable to $22.1 million and $47.3 million from first lien secured debt, $1.0 million and $3.0 million from second lien secured debt, $1.1 million and $2.2 million from subordinated debt and $6.5 million and $12.4 million from other investments, respectively. For the three and six months ended March 31, 2024, investment income was $36.0 million and $70.3 million, respectively, which was attributable to $27.8 million and $52.9 million from first lien secured debt, $2.8 million and $5.4 million from second lien secured debt, $0.1 million and $1.4 million from subordinated debt and $5.3 million and $10.6 million from preferred and common equity, respectively. The decrease in investment income for three and six months ended March 31, 2025, was primarily due to a decrease in our total portfolio size and a decrease in our weighted average yield on debt investments.

    Expenses

    For the three and six months ended March 31, 2025, expenses totaled $19.2 million and $40.4 million, respectively, and were comprised of $10.6 million and $22.4 million of debt related interest and expenses, $4.0 million and $8.3 million of base management fees, $2.4 million and $5.2 million of incentive fees, $1.6 million and $3.3 million of general and administrative expenses and $0.6 million and $1.3 million of provision for excise taxes, respectively. For the three and six months ended March 31, 2024, expenses totaled $21.7 million and $40.4 million, respectively, and were comprised of; $11.9 million and $21.4 million of debt-related interest and expenses, $4.1 million and $8.1 million of base management fees, $3.0 million and $6.3 million of incentive fees, $1.9 million and $3.3 million of general and administrative expenses and $0.8 million and $1.2 million of provision for excise taxes, respectively. The decrease in expenses for the three months ended March 31, 2025, was primarily due to decreases in interest and expenses on debt and incentive fees. Total expenses were flat for the six months ended March 31, 2025.

    Net Investment Income

    For the three and six months ended March 31, 2025, net investment income totaled $11.4 million and $24.4 million, or $0.18 per share and $0.37 per share, respectively. For the three and six months ended March 31, 2024, net investment income totaled $14.3 million and $29.9 million, or $0.22 per share and $0.46 per share, respectively. The decrease in net investment income was primarily due to a decrease in investment income and partially offset by a decrease in expenses.

    Net Realized Gains or Losses

    For the three and six months ended March 31, 2025, net realized gains (losses) totaled $(27.7) million and $(30.3) million, respectively. For the three and six months ended March 31, 2024, net realized gains (losses) totaled $(31.0) million and $(29.2) million, respectively. The change in realized gains (losses) was primarily due to changes in the market conditions of our investments and the values at which they were realized.

    Unrealized Appreciation or Depreciation on Investments and Debt

    For the three and six months ended March 31, 2025, we reported net change in unrealized appreciation (depreciation) on investments of $27.1 million and $29.5 million, respectively. For the three and six months ended March 31, 2024, we reported net change in unrealized appreciation (depreciation) on investments of $33.2 million and $28.3 million, respectively. As of March 31, 2025 and September 30, 2024, our net unrealized appreciation (depreciation) on investments totaled $40.7 million and $11.2 million, respectively. The net change in unrealized depreciation on our investments was primarily due to changes in the capital market conditions of our investments and the values at which they were realized.

    For the three and six months ended March 31, 2025, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $(1.4) million and $1.9 million, respectively. For the three and six months ended March 31, 2024, the Truist Credit Facility had a net change in unrealized appreciation (depreciation) of $0.5 million and $(1.6) million, respectively. As of March 31, 2025 and September 30, 2024, the net unrealized appreciation (depreciation) on the Truist Credit Facility totaled $3.0 million and $1.1 million, respectively. The net change in unrealized depreciation compared to the same periods in the prior period was primarily due to changes in the capital markets.

    Net Change in Net Assets Resulting from Operations

    For the three and six months ended March 31, 2025, net increase (decrease) in net assets resulting from operations totaled $9.5 million and $25.5 million or $0.14 per share and $0.39 per share, respectively. For the three and six months ended March 31, 2024, net increase (decrease) in net assets resulting from operations totaled $16.1 million and $26.7 million or $0.25 per share and $0.41 per share, respectively. The change in net assets from operations for the six months ended March 31, 2025 was primarily due to a change in the net realized and unrealized depreciation in the portfolio primarily driven by changes in market conditions and decrease in net investment income.

    LIQUIDITY AND CAPITAL RESOURCES

    Our liquidity and capital resources are derived primarily from cash flows from operations, including income earned, proceeds from investment sales and repayments and proceeds of securities offerings and debt financings. Our primary use of funds from operations includes investments in portfolio companies and payments of interest expense, fees and other operating expenses we incur. We have used, and expect to continue to use, our debt capital, proceeds from the rotation of our portfolio and proceeds from public and private offerings of securities to finance our investment objectives and operations.

    As of March 31, 2025 and September 30, 2024, we had $314.5 million and $461.5 million, respectively, in outstanding borrowings under the Truist Credit Facility. The Truist Credit Facility had a weighted average interest rate of 6.7% and 7.2%, respectively, exclusive of the fee on undrawn commitment.  As of March 31, 2025 and September 30, 2024, we had $185.5 million and $13.5 million of unused borrowing capacity under the Truist Credit Facility, respectively, subject to leverage and borrowing base restrictions.

    As of March 31, 2025 and September 30, 2024, we had cash and cash equivalents of $32.6 million and $49.9 million, respectively, available for investing and general corporate purposes. We believe our liquidity and capital resources are sufficient to allows us to effectively operate our business.

    For the six months ended March 31, 2025, our operating activities provided cash of $161.1 million and our financing activities used cash of $178.3 million. Our operating activities provided cash primarily due to our investment activities and our financing activities used cash primarily for repayments of our credit facility and distributions paid to stockholders.

    For the six months ended March 31, 2024, our operating activities used cash of $150.9 million and our financing activities provided cash of $147.5 million. Our operating activities used cash primarily due to our investment activities and our financing activities provided cash primarily from borrowings under the Truist Credit Facility.

    DISTRIBUTIONS

    During the three and six months ended March 31, 2025, we declared distributions of $0.24 and $0.48 per share, for total distributions of $15.7 million and $31.3 million, respectively. During the three and six months ended March 31, 2024, we declared distributions of $0.21 and $0.42 per share, for total distributions of $13.7 million and $27.4 million, respectively. We monitor available net investment income to determine if a return of capital for tax purposes may occur for the fiscal year. To the extent our taxable earnings fall below the total amount of our distributions for any given fiscal year, stockholders will be notified of the portion of those distributions deemed to be a tax return of capital. Tax characteristics of all distributions will be reported to stockholders subject to information reporting on Form 1099-DIV after the end of each calendar year and in our periodic reports filed with the SEC.

    AVAILABLE INFORMATION

    The Company makes available on its website its Quarterly Report on Form 10-Q filed with the SEC and stockholders may find the report on our website at www.pennantpark.com.

    PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES
    (In thousands, except share data)
     
      March 31, 2025     September 30, 2024  
      (unaudited)        
    Assets          
    Investments at fair value          
    Non-controlled, non-affiliated investments (amortized cost—$716,505 and $916,168, respectively) $ 723,808     $ 910,323  
    Non-controlled, affiliated investments (amortized cost—$58,068 and $56,734, respectively)   11,050       33,423  
    Controlled, affiliated investments (amortized cost—$398,359 and $343,970, respectively)   478,752       384,304  
    Total investments (amortized cost—$1,172,932 and $1,316,872, respectively)   1,213,610       1,328,050  
    Cash and cash equivalents (cost—$32,568 and $49,833, respectively)   32,587       49,861  
    Interest receivable   5,322       5,261  
    Distribution receivable   6,040       5,417  
    Due from affiliates   35       228  
    Prepaid expenses and other assets   185       269  
    Total assets   1,257,779       1,389,086  
    Liabilities          
    Truist Credit Facility payable, at fair value (cost—$314,456 and $461,456, respectively)   311,412       460,361  
    2026 Notes payable, net (par— $150,000)   149,022       148,571  
    2026 Notes-2 payable, net (par— $165,000)   163,506       163,080  
    Payable for investment purchased   124,609       100,096  
    Interest payable on debt   6,349       6,406  
    Distributions payable   5,224       5,224  
    Base management fee payable   4,017       4,297  
    Accounts payable and accrued expenses   3,108       4,053  
    Incentive fee payable   2,425       3,057  
    Due to affiliate   1       33  
    Total liabilities   769,673       895,178  
    Commitments and contingencies          
    Net assets          
    Common stock, 65,296,094 and 65,296,094 shares issued and outstanding, respectively              
    Par value $0.001 per share and 200,000,000 shares authorized   65       65  
    Paid-in capital in excess of par value   743,968       743,968  
    Accumulated deficit   (255,927 )     (250,125 )
    Total net assets $ 488,106     $ 493,908  
    Total liabilities and net assets $ 1,257,779     $ 1,389,086  
    Net asset value per share $ 7.48     $ 7.56  
                   
    PENNANTPARK INVESTMENT CORPORATION AND SUBSIDIARIES
    CONSOLIDATED STATEMENTS OF OPERATIONS
    (In thousands, except share data)
    (Unaudited)
     
      Three Months Ended March 31,     Six Months Ended March 31,  
      2025     2024     2025     2024  
    Investment income:                      
    From non-controlled, non-affiliated investments:                      
    Interest $ 14,987     $ 22,904     $ 33,753     $ 43,972  
    Payment-in-kind   1,564       187       2,985       189  
    Dividend income   499       623       1,006       1,315  
    Other income   120       778       702       2,203  
    From non-controlled, affiliated investments:                      
    Payment-in-kind                     347  
    From controlled, affiliated investments:                      
    Interest   7,887       5,941       15,142       11,422  
    Payment-in-kind         857       823       1,489  
    Dividend income   5,579       4,689       10,430       9,378  
    Other income   27             27        
    Total investment income   30,663       35,979       64,868       70,315  
    Expenses:                      
    Interest and expenses on debt   10,318       11,868       22,058       21,424  
    Base management fee   4,017       4,137       8,285       8,141  
    Incentive fee   2,425       3,018       5,180       6,339  
    General and administrative expenses   1,150       1,379       2,400       2,593  
    Administrative services expenses   450       550       950       739  
    Expenses before amendment costs, debt issuance costs and provision for taxes   18,360       20,952       38,873       39,236  
    Provision for taxes on net investment income   550       775       1,250       1,168  
    Credit facility amendment and debt issuance costs   324             324        
    Net expenses   19,234       21,727       40,447       40,404  
    Net investment income   11,429       14,252       24,421       29,911  
    Realized and unrealized gain (loss) on investments and debt:                      
    Net realized gain (loss) on investments and debt:                      
    Non-controlled, non-affiliated investments   (27,714 )     (1,434 )     (30,274 )     1,146  
    Non-controlled and controlled, affiliated investments         (29,419 )           (30,169 )
    Provision for taxes on realized gain on investments   (49 )     (177 )     (49 )     (177 )
    Net realized gain (loss) on investments and debt   (27,763 )     (31,030 )     (30,323 )     (29,200 )
    Net change in unrealized appreciation (depreciation) on:                      
    Non-controlled, non-affiliated investments   17,918       (1,528 )     13,141       (13,798 )
    Non-controlled and controlled, affiliated investments   9,214       34,751       16,352       42,075  
    Provision for taxes on unrealized appreciation (depreciation) on investments   37       (830 )           (680 )
    Debt appreciation (depreciation)   (1,379 )     470       1,949       (1,570 )
    Net change in unrealized appreciation (depreciation) on investments and debt   25,790       32,863       31,442       26,027  
    Net realized and unrealized gain (loss) from investments and debt   (1,973 )     1,833       1,119       (3,173 )
    Net increase (decrease) in net assets resulting from operations $ 9,456     $ 16,085     $ 25,540     $ 26,738  
    Net increase (decrease) in net assets resulting from operations per common share $ 0.14     $ 0.25     $ 0.39     $ 0.41  
    Net investment income per common share $ 0.18     $ 0.22     $ 0.37     $ 0.46  
                                   

    ABOUT PENNANTPARK INVESTMENT CORPORATION

    PennantPark Investment Corporation, or the Company, is a business development company that invests primarily in U.S. middle-market companies in the form of first lien secured debt, second lien secured debt, subordinated debt and equity investments. PennantPark Investment Corporation is managed by PennantPark Investment Advisers, LLC.

    ABOUT PENNANTPARK INVESTMENT ADVISERS, LLC

    PennantPark Investment Advisers, LLC is a leading middle market credit platform, managing approximately $10 billion of investable capital, including available leverage. Since its inception in 2007, PennantPark Investment Advisers, LLC has provided investors access to middle market credit by offering private equity firms and their portfolio companies as well as other middle-market borrowers a comprehensive range of creative and flexible financing solutions. PennantPark Investment Advisers, LLC is headquartered in Miami and has offices in New York, Chicago, Houston, Los Angeles, and Amsterdam.

    FORWARD-LOOKING STATEMENTS

    This press release may contain “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. You should understand that under Section 27A(b)(2)(B) of the Securities Act of 1933, as amended, and Section 21E(b)(2)(B) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995 do not apply to forward-looking statements made in periodic reports PennantPark Investment Corporation files under the Exchange Act. All statements other than statements of historical facts included in this press release are forward-looking statements and are not guarantees of future performance or results and involve a number of risks and uncertainties. Actual results may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in filings with the SEC. PennantPark Investment Corporation undertakes no duty to update any forward-looking statement made herein. You should not place undue influence on such forward-looking statements as such statements speak only as of the date on which they are made.

    We may use words such as “anticipates,” “believes,” “expects,” “intends,” “seeks,” “plans,” “estimates” and similar expressions to identify forward-looking statements. Such statements are based on currently available operating, financial and competitive information and are subject to various risks and uncertainties that could cause actual results to differ materially from our historical experience and our present expectations.

    The information contained herein is based on current tax laws, which may change in the future. The Company cannot be held responsible for any direct or incidental loss resulting from applying any of the information provided in this publication or from any other source mentioned. The information provided in this material does not constitute any specific legal, tax or accounting advice. Please consult with qualified professionals for this type of advice.

    Contact: Richard T. Allorto, Jr.
      PennantPark Investment Corporation
      (212) 905-1000
      www.pennantpark.com

    The MIL Network

  • MIL-OSI: Exodus Reports First Quarter 2025 Results

    Source: GlobeNewswire (MIL-OSI)

    OMAHA, Neb., May 12, 2025 (GLOBE NEWSWIRE) — Exodus Movement, Inc. (NYSE American: EXOD) (“Exodus”), a leading self-custodial cryptocurrency platform, today announced its unaudited results for the first quarter ended March 31, 2025.

    First Quarter 2025 Financial Highlights (Unaudited)

           
    In USD millions, except percentages Q1 2025 Q1 2024  % Change
                       
    Revenue $ 36.0   $ 29.1     24 %
                       
    Technology, development and user support   14.9     10.7     39 %
                       
    General and administrative   14.3     8.0     79 %
                       
    Loss (gain) on digital assets, net   28.8     (56.8 )   (151 %)
                       
    Net (loss) income   (12.9 )   54.8     (124 %)
                       

    “Exodus continues to offer innovative solutions that capitalize on the growing market for digital assets,” said JP Richardson, CEO and co-founder of Exodus. “Meanwhile, our focus on self-custody remains a difference-maker.”

    First Quarter Operational and Other Financial Highlights

    • Exchange provider processed volume – $2.18 billion in Q1 2025, down 7% from Q4 2024. Bitcoin, Tether (TRX Network), Solana, Tether (ETH Network), ETH, and XRP were the top assets traded in Q1 2025, at 16%, 11%, 11%, 9%, 8%, and 8% of volume, respectively.
    • Exodus monthly active users – 1.6 million at end of Q1 2025, down 30% from 2.3 million as of December 31, 2024.
    • Exodus quarterly funded users – 1.8 million at end of Q1 2025, down 5% from 1.9 million as of December 31, 2024.
    • Digital assets, cash, and cash equivalents – $238.0 million, including 2,011 units of Bitcoin valued at $166.0 million, 2,693 units of Ether valued at $4.9 million, and $62.8 million in cash and cash equivalents, USD Coin (USDC), and Treasury bills as of March 31, 2025.
    • Full-time equivalent team members – approximately 210 as of March 31 2025, unchanged from the prior quarter.
    • Customer response time – average response time of less than 60 minutes in Q1.

    “Q1 saw our highest first quarter revenue and second best revenue quarter on record.” said James Gernetzke, CFO of Exodus. “With an abundance of opportunities at our doorstep, Exodus is well-positioned to expand within our industry and beyond, well into the future.”

    Q1 2025 Webcast 

    Exodus will host a webcast of its preliminary first quarter 2025 fiscal results beginning at 4:30PM (Eastern Time) on May 12, 2025. To access the webcast, please use this link. It will also be carried on the Company’s website exodus.com/investors. Supplementary materials will also be made available prior to the webcast on the “Investor Relations” portion of the Company website, and a replay of the video webcast will be available following the live event for at least 90 days thereafter.

    Investor Contact
    investors@exodus.com

    Disclosure Information

    Exodus may use its website and the following social media outlets as distribution channels of material nonpublic information about the Company. Financial and other important information regarding the Company is routinely accessible through and posted on the following: websites exodus.com/investors and exodus.com/blog, and social media: X (@exodus and JP Richardson’s feed @jprichardson), Facebook, LinkedIn, and YouTube.

    Forward-Looking Statements

    This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements, other than statements of historical facts, may be forward-looking statements. Forward-looking statements are based on our beliefs and assumptions and on information currently available to us as of the date hereof. In some cases, you can identify forward-looking statements by the following words: “will,” “expect,” “would,” “should,” “intend,” “believe,” “expect,” “likely,” “believes,” “views”, “estimates”, or other comparable terminology. Forward-looking statements in this document include, but are not limited to, our preliminary financial information, including digital asset holdings, exchange provider processed volumes and our fiscal quarter end results, management statements regarding management’s confidence in our products, services, business trajectory and plans, expectations regarding demand for our products; and our ability to deliver higher transaction volumes. Such forward-looking statements involve a number of risks, uncertainties and other important factors that could cause our actual results to differ materially from those expressed or implied by our forward-looking statements. Such factors include those set forth in “Item 1. Business” and “Item 1A. Risk Factors” of Form 10-K filed with the Securities and Exchange Commission (the “SEC”) on March 6, 2025, as well as in our other reports filed with the SEC from time to time. All forward-looking statements are expressly qualified in their entirety by such cautionary statements. Readers are cautioned not to place undue reliance on such forward-looking statements. Except as required by law, we undertake no obligation to update or revise any forward-looking statements that have been made to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.

    The MIL Network

  • MIL-OSI Video: FBI Director Kash Patel’s National Police Week Message

    Source: Federal Bureau of Investigation (FBI) (video statements)

    FBI Director Kash Patel thanked law enforcement officers in his National Police Week message for their work protecting our communities and pursuing justice and he honored the legacies of those who have made the ultimate sacrifice.

    —————————————————
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    https://www.youtube.com/watch?v=68Oo1Jj0hXw

    MIL OSI Video

  • MIL-OSI Europe: EIB Global and Kenya-based Family Bank team up in €100 million financing deal for country’s women and young entrepreneurs

    Source: European Investment Bank

    EIB

    • The financing targets expanding credit access to women owned/led businesses and youth entrepreneurs in Kenya
    • EIB Global will advance €50 million, which Family Bank will match
    • Part of EU’s Global Gateway strategy to promote trade, manufacturing, agriculture, climate action and services, which are key priorities in Kenya

    The European Investment Bank’s development arm (EIB Global) and Kenya-based Family Bank are mobilising €100 million (14.7 billion Kenyan shillings) in financing for businesses, with a focus on women-owned/led enterprises and youth entrepreneurs in the country. EIB Global is providing a €50 million credit line to Family Bank, which will match the sum in an agreement to expand loans for Kenyan small and medium-sized enterprises (SMEs) and Mid-Caps.

    The financing accord, announced during the second edition of the European Union-Kenya business forum in Nairobi, seeks to bolster the working capital and investments of Kenyan SMEs and Mid-Caps active mainly in the trade and agriculture sectors. At least 50% of the financing will target businesses owned or run by women while a further minimum of 30% will be extended to youth entrepreneurs. 

    “SMEs represent over 80% of our customer base. As a result of our growth efforts, our market revenue from this segment continues to increase, further underscoring the sector’s strong growth potential,” said Family Bank Chief Executive Officer Nancy Njau. “This partnership not only supports our 2025–2029 strategy to scale SME lending and deepen market segmentation but also enables us to better address the specific needs of SMEs across various value chains for sustainable growth and long-term value.”

    In addition to the credit line, EIB Global will provide Family Bank with technical assistance to enhance its gender strategy and product offering. This includes a potential certification under a 2018 initiative called 2X Challenge launched by development and multilateral finance institutions to invest in women worldwide.

    “We recognise that beyond access to financing and investment opportunities, small businesses, especially those led by women, also need education, information and networking opportunities with like-minded enterprises,” said Njau. “This partnership enables us to offer that holistic support.”

    The agreement is part of the EU’s Global Gateway strategy to promote trade, manufacturing, agriculture, climate action and services, which are key priorities in Kenya. It also feeds into a European initiative called Investing in Young Businesses in Africa (IYBA) that operates across Africa with the goal of creating sustainable jobs and expanding business opportunities. The EIB currently chairs the IYBA.

     “The financing partnership we now have with Family Bank will inject much-needed capital into Kenya’s private sector to support businesses and create employment,” said EIB Vice-President Thomas Ostros. “Investing in women and youth entrepreneurs is not only the right thing to do but also the smart thing to do. It holds much promise to bring growth and prosperity to the Kenyan economy. This is a cause that is very important to us.”

    The agreement signed between EIB Global and Family Bank represents the fourth time that the banks are partnering

    “European Fund for Sustainable Development Fund Plus (#EFSD+) is a testament to our commitment to fostering sustainable economic growth by empowering small and medium-sized enterprises (SMEs) in partner countries,” said European Commission Director for International Partnerships – Africa, Hans Stausboll. “Through this strategic partnership with the European Investment Bank, we’re unlocking vital financial resources for SMEs in Kenya, via Family Bank. This collaboration not only fuels female-led entrepreneurship and innovation but also spurs climate smart and sustainable value chains across the Kenyan landscape. More in general, it contributes to Global Gateway strategy in Kenya across various economic sub-sectors including manufacturing, services, trade and competitiveness.”

    Background Information

    About EIB Global

    The European Investment Bank (ElB) is the long-term lending institution of the European Union, owned by its Member States. It finances investments that contribute to EU policy objectives.  

    EIB Global is the EIB Group’s specialised arm devoted to increasing the impact of international partnerships and development finance, and a key partner of Global Gateway. EIB Global aims to support €100 billion of investment by the end of 2027 — around one-third of the overall target of this EU initiative. Within Team Europe, EIB Global fosters strong, focused partnerships alongside fellow development finance institutions and civil society. EIB Global brings the EIB Group closer to people, companies and institutions through offices across the world. High-quality, up-to-date photos of the organisation’s headquarters for media use are available here. 

    About Global Gateway

    The Global Gateway strategy is the EU’s positive offer to reduce the worldwide investment disparity and boost smart, clean and secure connections in digital, energy and transport sectors, and to strengthen health, education and research systems. In a Team Europe approach that brings together the European Union, EU Member States, and European development finance institutions, together we aim to mobilise up to €300 billion in public and private investments from 2021 to 2027, creating essential links rather than dependencies, and closing the global investment gap.

    The EU-Africa Global Gateway investment package consists of 150 billion in investments to help accelerate Africa’s digital and green transition as well as support sustainable jobs growth and stronger health systems. More information on the investment package as well as country specific flagships can be found here.

    About Family Bank:

    Family Bank is a financial institution that prides itself in growing a strong retail customer base, with a strong focus on SME banking, anchored on the positive transformation of people’s lives in Africa. Family Bank is the eighth-largest bank in Kenya, in terms of branch network with 95 branches across 32 counties. The Bank has over 1.2 million customers, 6,000 bank agents and 75,000 merchants across the country with total assets of KES.168.5 billion and a deposit base of KES 126.4 billion as of 31st December 2024.

    A pioneer in digital banking innovation, Family Bank was the first in Kenya to introduce paperless banking through smart card technology, mobile banking, and PesaPap. It also made history as the first bank in Africa to launch the mVisa service, reinforcing its commitment to seamless and accessible financial solutions.

    In 2024, Family Bank was recognized for its commitment to excellence, winning the Excellence in Customer Responsiveness award at the Innovation & Excellence Awards East Africa. The Bank was also voted the third-best overall bank and the best tier-two bank for the fifth consecutive year in the Kenya Bankers Association Customer Satisfaction and Digital Banking Experience Survey. Additionally, Family Bank emerged as the winner of the 2024 Banking on Women Awards and received the prestigious Service Excellence Award in the CX Social Impact & Sustainability category from the Institute of Customer Experience.

    Previously, in 2021, Family Bank’s highly successful Corporate Bond Campaign, which achieved a 147.3% subscription rate, raising KES 4.42 billion through public placement, earned the Financial Communication Campaign of the Year and Overall Public Relations Campaign of the Year at the Public Relations Society of Kenya Annual Awards for Excellence.

    Other notable accolades include Best-Performing Young Bankers in Africa at the 2023 Battle of the Banks Africa Competition and Best in Internal Customer Experience at the 2023 Service Excellence Awards. In 2022, Family Bank was named Bank of the Year for high-impact agricultural lending to SMEs by Aceli Africa. The Bank also received the Best SME Bank in Kenya award at the 2017 Banker Africa East Africa Awards, a prestigious initiative recognizing excellence in African financial institutions. Additionally, Family Bank was honored with the Think Business Fastest Growing Bank Award for three consecutive years (2013-2015) and was the 1st Runner-Up for Best Bank in Microfinance at the Think Business Awards in 2013 and 2014.

    MIL OSI Europe News

  • MIL-OSI USA: Reps. Sherrill and Bacon Introduce Bipartisan Legislation to Protect Firefighters

    Source: United States House of Representatives – Congresswoman Mikie Sherrill (NJ-11)

    WASHINGTON, DC — Today, Congresswoman Mikie Sherrill (NJ-11) and Congressman Don Bacon (NE-02) introduced the bipartisan PROTECT Firefighters Act, which will help keep firefighters safe in crisis situations by improving equipment, training, and staffing for departments’ emergency rescue teams. Alongside this legislation, Rep. Sherrill also sent a letter to Speaker Johnson, Leader Jeffries, Appropriations Committee Chair Cole, and Appropriations Committee Ranking Member DeLauro urging them to fully fund firefighter assistance grants and the U.S. Fire Administration. 

    “Firefighters risk their lives to protect our communities, often rushing into danger while others are rushing out. In recent years, we have sadly seen an increase in the number of firefighters killed while on-duty. New Jersey knows that pain all too well. The tragic loss of two Newark firefighters in July 2023 after a major fire at the Port of Newark underscored the need for additional training, equipment, and support. That’s why I was proud to work alongside Rep. Bacon and firefighters across New Jersey to craft legislation that will take concrete steps to ensure our heroes have the resources to do their jobs safely and effectively,” said Rep. Sherrill

    “Our firefighters put their lives on the line every day to keep our communities safe. As a member of the Congressional Fire Services Caucus, I’m co-leading the bipartisan PROTECT Firefighters Act with Rep. Sherrill to ensure these heroes have the proper training, equipment, and resources needed,” said Rep. Bacon. “When responding to emergencies, our firefighters deserve the best possible tools and support for a safe return home to loving families.”

    Sherrill’s legislation has earned the endorsement of the New Jersey Firefighters Mutual Benevolent Association, International Association of Fire Chiefs, and National Fallen Firefighters Foundation.

    “As we continue to advocate for maximum funding of our Congressional grants, we still have gaps to fill,” said Eddie Donnelly, President of the New Jersey Firefighters Mutual Benevolent Association. “In New Jersey, our members are called out daily to support fire suppression efforts in neighboring municipalities. Rapid Intervention Teams are needed and required to be on the scene to assist in the removal of down Firefighters. No one comes to help us – except us. The PROTECT Firefighters Act will provide for a concise study on what is fiscally needed to be sure we have every tool possible to achieve life saving results. It will also take a hard look at the specific challenges of maritime firefighting. New Jersey Firefighters will never forget our brothers in Newark, Augie and Wayne, who made the ultimate sacrifice battling a ship fire in Port Newark. We continue to urge Congress to fund our fiscal priorities and applaud  Congresswoman Sherrill for her continued efforts on behalf of New Jersey’s first responders.”

    “Rapid Intervention Teams are a critical component to keeping firefighters safe during an emergency incident.  We appreciate Congresswoman Sherrill and Congressman Bacon’s commitment to ensuring RITs have the necessary equipment, staffing, and training needed to minimize firefighter risk and injury,” said Victor Stagnaro, CEO of the National Fallen Firefighters Foundation.

    The PROTECT Firefighters Act directs the U.S. Fire Administration to develop a comprehensive strategy to improve equipment, training, and staffing standards for firefighter Rapid Intervention Teams (RITs) – firefighting crews that serve as stand-by rescue teams at the scenes of fires and other emergencies – including RITs that respond to port facility fires.

    The bill also directs the U.S. Fire Administrator to review the National Institute for Occupational Safety and Health’s Fire Fighter Fatality Investigation and Prevention Program Line of Duty Death reports and provide recommendations for how Congress can address the specific causes of incidents in which a firefighter was killed in the line of duty.

    Rep. Sherrill’s letter to House leadership urges them to provide maximum funding for firefighter assistance grants and the U.S. Fire Administration in this year’s appropriations process, and to fully fund the recommendations of the U.S. Fire Administration’s strategy required by the PROTECT Firefighters Act. You can read the full letter here, and below.

    Dear Speaker Johnson, Minority Leader Jeffries, Chair Cole, and Ranking Member DeLauro:

    We represent thousands of firefighters who put their lives at risk every day to protect our constituents and communities. During the COVID-19 pandemic, these heroes served on the frontline of the public health emergency and played a crucial role in delivering life-saving assistance to those in need. While important progress has been made in improving the safety of our firefighters over the past four decades, we are alarmed and saddened by the recent increase in deaths in the line of duty. In 2022, 80 firefighters were killed while on-duty, and 73 were killed in 2023 . These are the highest number of deaths since 2013, and two of the three highest years since 2009. In the face of these tragedies, we urge you to provide maximum funding for firefighter assistance grants and the U.S. Fire Administration in this year’s appropriations process and to support the development of a comprehensive strategy by the U.S. Fire Administration to better protect firefighters responding to crisis situations, as laid out in the bipartisan PROTECT Firefighters Act.

    Congress has a critical role to play in ensuring that state and local fire departments have the resources they need to purchase high-quality equipment and safety gear, recruit and retain firefighters to ensure needed staffing levels, and engage in advanced training initiatives. Through FEMA’s Assistance to Firefighters Grants (AFG) and Staffing For Adequate Fire and Emergency Response (SAFER) programs, Congress has provided over $15 billion in life-saving funding to firefighters, including $700 million in FY 2024.  We were very proud to vote for the Fire Grants and Safety Act in May 2024 to reauthorize these critical programs through FY 2028 to ensure that they can keep providing critical equipment and training to our first responders.

    As we’ve met with firefighters throughout our district this year, however, it is clear that fire departments have urgent funding needs that are not being met with current levels of federal assistance. AFG and SAFER each receive grant applications of over $2 billion each per year from fire departments, while combined funding between both programs remains considerably below $1 billion annually.  This deficit means that fire departments nationwide are unable to replace outdated equipment, send their firefighters to advanced training programs, and hire enough employees to meet safe staffing levels.

    In New Jersey, two Newark Fire Division firefighters were killed in the line of duty in July 2023 after a major fire at the Port of Newark.  An investigation of this tragedy by the U.S. Coast Guard revealed that Newark firefighters had not received hands-on shipboard training, even though they are responsible for responding to fires at these facilities if needed. The investigation also found that the radio communications equipment used by the Newark firefighters performed poorly during the port fire response, which resulted in many of the firefighters being unable to communicate with each other adequately during the incident. In addition, the National Transportation Safety Board – in their report released on April 15th – found that a lack of training and familiarity with marine firefighting played a key role in the tragedy.  Our firefighters put their lives on the line every time they enter a burning building or ship, and they should have the best equipment and training available to ensure that they can remain as safe as possible. In our conversations with fire chiefs nationwide, however, cost remains a significant barrier to acquiring these life-saving resources. Local governments have significant fiscal constraints that limit funding opportunities, while the AFG and SAFER programs can fund less than a third of their annual grant requests due to limited federal appropriations.

    Therefore, we strongly urge you to provide the maximum possible funding for the AFG and SAFER programs, as well as the U.S. Fire Administration, in this year’s FY 2026 appropriations process. These critical resources will allow fire departments to invest in the advanced equipment and training that will save lives in crisis situations. Each year, billions of dollars in fire departments’ grant requests remain unmet not because they are unneeded but simply due to a lack of appropriations, and it is critical that we now provide this life-saving assistance to our firefighters.

    Furthermore, we recently introduced the PROTECT Firefighters Act, which would task the U.S. Fire Administration with developing a comprehensive strategy to identify current deficiencies in equipment, training, and staffing standards for firefighter Rapid Intervention Teams (RITs) and provide recommendations for how Congress can address these issues. RITs serve as stand-by teams for the immediate search and rescue of missing, trapped, or injured firefighters and play a crucial role in ensuring the safety of our firefighters. This strategy will allow the U.S. Fire Administration to identify key areas where federal funding is most urgently needed to protect firefighters, with a particular emphasis on tragedies in which a firefighter was killed in the line of duty. In addition, the strategy will help to better coordinate national efforts to equip and train fire departments that respond to maritime fires, which can present unique challenges and risks to firefighters. We urge you to support this critical legislation and to ensure that federal funding is available to implement the equipment, training, and staffing recommendations provided by the U.S. Fire Administration.

    We greatly appreciate the bipartisan work of this Congress to reauthorize the AFG and SAFER programs and to provide critical assistance to firefighters around the country. However, recent events have shown that the federal government must do more to ensure firefighter safety. We now urge Congressional leadership to support the development of a comprehensive strategy to protect firefighters in crisis situations, fully fund the recommendations of this strategy, and provide maximum funding for AFG, SAFER, and the U.S. Fire Administration. We look forward to staying engaged on this issue as Congress develops its appropriations package for FY 2026.

    ###

    MIL OSI USA News

  • MIL-OSI Video: Watch ICE Orange County special agents arrest MS-13 gang member accused of double homicide

    Source: United States of America – Federal Government Departments (video statements)

    DANA POINT, Calif. — ICE special agents arrested Wilbur Antonio Acevedo-Duran, an unlawfully present criminal alien and MS-13 gang member, May 6.

    Salvadoran national
    Accused of a double homicide in El Salvador
    Pending U.S. criminal charges | Illegal reentry after removal
    Arrested by ICE Homeland Security Investigations Orange County special agents

    Follow our page for details about criminal arrests, operational videos & more.

    https://www.youtube.com/watch?v=PP79PSgHLbw

    MIL OSI Video

  • MIL-OSI Europe: Text adopted – Banking Union – annual report 2024 – P10_TA(2025)0105 – Thursday, 8 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to its resolution of 16 January 2024 on Banking Union – annual report 2023(1),

    –  having regard to the Commission’s follow-up to Parliament’s resolution of 16 January 2024 on Banking Union – annual report 2023,

    –  having regard to document published by the European Central Bank (ECB) on 25 March 2024, entitled ‘Feedback on the input provided by the European Parliament as part of its resolution on Banking Union 2023’,

    –  having regard to the ECB’s 2023 Annual Report on supervisory activities, published in March 2024,

    –  having regard to the 2023 Annual Report of the Single Resolution Board (SRB), published on 28 June 2024,

    –  having regard to the adoption of the Anti-Money Laundering Directive (AMLD)(2) and the Anti-Money Laundering Regulation (AMLR)(3), and to the establishment of the Anti-Money Laundering Authority (AMLA)(4),

    –  having regard to the implementation of the Basel III standards, namely to the adoption of amendments to the Capital Requirements Directive(5) and to the Capital Requirements Regulation(6),

    –  having regard to the adoption of Commission Delegated Regulation (EU) 2024/2795 of 24 July 2024 amending Regulation (EU) No 575/2013 of the European Parliament and of the Council with regard to the date of application of the own funds requirements for market risk(7),

    –  having regard to its position at first reading of 24 April 2024 on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EU) No 806/2014 as regards early intervention measures, conditions for resolution and funding of resolution action(8),

    –  having regard to its position at first reading of 24 April 2024 on the proposal for a Directive of the European Parliament and of the Council amending Directive 2014/59/EU as regards early intervention measures, conditions for resolution and financing of resolution action(9),

    –  having regard to its position at first reading of 24 April 2024 on the proposal for a Directive of the European Parliament and of the Council amending Directive 2014/49/EU as regards the scope of deposit protection, use of deposit guarantee schemes funds, cross-border cooperation, and transparency(10),

    –  having regard to the report of its Committee on Economic and Monetary Affairs of 23 April 2024 on the proposal for a regulation of the European Parliament and of the Council amending Regulation (EU) 806/2014 in order to establish a European Deposit Insurance Scheme,

    –  having regard to the Commission proposal of 14 March 2018 for a directive of the European Parliament and of the Council on credit servicers, credit purchasers and the recovery of collateral (COM(2018)0135),

    –  having regard to the Five Presidents’ Report of 22 June 2015 entitled ‘Completing Europe’s Economic and Monetary Union’,

    –  having regard to Enrico Letta’s report of 10 April 2024 entitled ‘Much more than a market – Speed, security, solidarity: empowering the Single Market to deliver a sustainable future and prosperity for all EU Citizens’,

    –  having regard to Mario Draghi’s report of 9 September 2024 entitled ‘The future of European competitiveness’,

    –  having regard to the Eurogroup statement of 11 March 2024 on the future of Capital Markets Union, and to the Eurogroup statement of 16 June 2022 on the future of the Banking Union and the Eurogroup follow-up thereto of 28 April 2023,

    –  having regard to the Basel Committee on Banking Supervision’s disclosure framework for banks’ cryptoasset exposures and to the targeted amendments to its prudential standard on banks’ exposures to cryptoassets, both published on 17 July 2024,

    –  having regard to the Basel Committee on Banking Supervision’s core principles for effective banking supervision, published on 25 April 2024,

    –  having regard to the ECB’s Financial Stability Review of May 2024,

    –  having regard to the ECB Occasional Paper No 328 of 2023 entitled ‘The Road to Paris: stress testing the transition towards a net-zero economy’,

    –  having regard to the Financial Stability Board publication of 9 November 2015 entitled ‘Principles on Loss-absorbing and Recapitalisation Capacity of G-SIBs in Resolution’,

    –  having regard to the Financial Stability Board report of 10 October 2023 entitled ‘2023 Bank Failures – Preliminary lessons learnt for resolution’,

    –  having regard to Peterson Institute for International Economics Working Paper No 24-15 of 25 June 2024 entitled ‘Europe’s banking union at ten: unfinished yet transformative’(11),

    –  having regard to the Single Supervisory Mechanism supervisory priorities for 2024-2026, published in December 2023,

    –  having regard to the SRB’s biannual reporting note to the Eurogroup of 13 May 2024,

    –  having regard to the outcome of the 2023 EU-wide transparency exercise of the European Banking Authority, published on 28 July 2023,

    –  having regard to Special Report 12/2023 of the European Court of Auditors of 12 May 2023 entitled ‘EU supervision of banks’ credit risk – The ECB stepped up its efforts but more is needed to increase assurance that credit risk is properly managed and covered’,

    –  having regard to the statements by Claudia Buch, Chair of the Supervisory Board of the ECB, at the hearings conducted by Parliament’s Committee on Economic and Monetary Affairs on 21 March 2024 and 2 September 2024,

    –  having regard to the statements by Dominique Laboureix, Chair of the SRB, at the hearings conducted by Parliament’s Committee on Economic and Monetary Affairs on 21 March 2024 and 23 September 2024,

    –  having regard to the European Banking Authority’s risk assessment reports of July 2024 and December 2024,

    –  having regard to its resolution of 14 March 2019 on gender balance in EU economic and monetary affairs nominations(12),

    –  having regard to its resolution of 25 March 2021 on strengthening the international role of the euro(13),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Economic and Monetary Affairs (A10-0044/2025),

    A.  whereas the Banking Union (BU) encompasses the Single Supervisory Mechanism, the Single Resolution Mechanism and a European deposit insurance that is still missing;

    B.  whereas the main objective of the BU is to safeguard the stability of the banking sector in Europe and prevent the need to bail out banks at risk of failure with taxpayers’ money;

    C.  whereas a completed BU would be a positive development for citizens and the EU economy, as it would improve the competitiveness and stability of the banking sector, reduce systemic risk, improve supply and consumer choice and offer increased opportunities for cross-border banking that enhances access to financing for households and businesses, thereby reducing costs for banks’ customers, while ensuring that public funds are not used to bail out the banking sector; whereas the ‘too big to fail’ risk has not yet been fully addressed;

    D.  whereas concluding the reform of the EU frameworks for bank crisis management and deposit insurance, focusing particularly on small and medium-sized banks, is fundamental in order to provide Europe’s banking sector with security, stability and resilience; whereas a complete BU with a true European deposit insurance scheme is a basic condition for ensuring that citizens trust European banks;

    E.  whereas fragmentation and the lack of cross-border consolidation of the EU banking sector is affecting its global competitiveness; whereas the profitability gap between EU and US banks has widened;

    F.  whereas a strong and diversified banking sector is key to delivering economic growth, increasing the possibility of home ownership, fostering investment and job creation, financing small and medium-sized enterprises (SMEs) and start-ups and ensuring the transition to a green and digital economy;

    G.  whereas around 80 % of external financing for EU companies comes from banks, while only 20 % comes from the capital markets; whereas only 30 % of credit for US firms comes from banks, while 70 % is funded via capital markets, including corporate bond holdings and shares;

    H.  whereas the EUR 356,1 billion in non-performing loans recorded at the 110 supervised institutions in 2024, compared with EUR 988,9 billion in non-performing loans recorded at the 102 supervised institutions in the second quarter of 2015, reflects a significant downward trajectory, leaving the total non-performing loan stock at 36 % of its 2015 level; whereas further efforts are required;

    I.  whereas in April 2024, it adopted its position on the review of the crisis management and deposit insurance framework;

    J.  whereas in April 2024, its Committee on Economic and Monetary Affairs adopted a report on the Commission’s proposal to establish a European deposit insurance scheme;

    K.  whereas financial institutions rely increasingly on the use of information and communications technology (ICT); whereas the digitalisation of finance provides key opportunities for the banking sector and has brought about significant technological advances in the EU banking sector through increased efficiency in the provision of banking services and a greater appetite for innovation; whereas it also poses challenges, including with regard to data protection, reputational risks, anti-money laundering and consumer protection concerns; whereas the EU banking sector must increase its cyber resilience to ensure that ICT systems can withstand various types of cyber security threats; whereas the ECB is currently studying the establishment of a digital euro;

    L.  whereas EU banks have withstood the impact of Russian aggression; whereas they play a pivotal role in ensuring the ongoing implementation of and compliance with the sanctions imposed by the EU against Russia in response to the invasion; whereas further coordination is needed to avoid circumvention of sanctions;

    M.  whereas climate change, environmental degradation and the transition to a low-carbon economy are factors to be taken into account when assessing the risks on banks’ balance sheets, as a source of risk potentially impacting investments across regions and sectors;

    General considerations

    1.  Acknowledges the progress made over the last 10 years through the establishment of the Single Supervisory Mechanism (SSM) and Single Resolution Mechanism (SRM); notes that the BU will not be completed without the establishment of its third pillar, the European deposit insurance scheme;

    2.  Asks the Commission to ensure that the completion of the BU and the Capital Markets Union remains a key priority; highlights that these projects offer households and SMEs access to broader funding, reduce the high reliance on bank credit to foster investments and job creation, increase financial stability, reduce the impact of economic downturns, support competitiveness, give additional investment opportunities, fund the transition to a green and digital economy and unlock the EU’s growth potential; notes that the Commission is requested to take into consideration the specificities of the different banking models, while preserving a level playing field;

    3.  Notes the need to be prepared for episodes of banking stress that could potentially lead to bank runs such as those witnessed in some jurisdictions outside the EU in March 2023, and the need to ensure the stability of deposits;

    4.   Points out that cyber resilience is a key element for the competitiveness of the EU banking sector, in particular taking into account the geopolitical situation and the need to preserve financial stability;

    5.  Notes that a more integrated BU would help to make the EU banking sector more resilient, improve access to credit and reduce costs; notes that better cross-border integration of banking business would increase the potential for private risk sharing and ensure diversification in the EU banking market; points out that a more integrated BU is not necessarily the same as a more consolidated banking market and that there are benefits for competition in a diversified banking market; stresses that a fully developed BU would allow EU banks to grow and put them in a better position to compete in the international arena;

    6.  Regrets that EU banks’ ability to finance major investments is constrained by lower profitability that is not sufficient to ensure their competitiveness; notes that the profitability gap as compared with other jurisdictions is due to both structural and regulatory factors and calls for a review to streamline the regulatory framework; notes that the specific character of the EU banking system, with its large number of smaller banks, calls for proportionate solutions that take this into account and are tailored to its characteristics, without undermining financial stability; remains mindful of the ‘too big to fail’ risk;

    7.  Calls on the Commission to assess the need to develop targeted frameworks within the BU to enhance access to finance for SMEs and start-ups, recognising their role as the backbone of the EU economy;

    8.  Regrets that EU banks’ cross-border activity is still rather limited, particularly with regard to granting loans; takes the view, therefore, that it is important to complete the BU in order to uphold the free movement of capital in a fully integrated internal market;

    9.  Calls on the EU banks still operating in Russia to exit the Russian market as soon as possible; calls on supervisory institutions to ensure that those banks push ahead with exiting the Russian market swiftly;

    10.  Invites the Commission to further explore whether the creation of a separate jurisdiction for EU banks with substantial cross-border operations(14) could help to complete the BU or whether this would increase banking sector fragmentation;

    11.  Notes that a review of the securitisation framework to strengthen European markets and the introduction of European Secured Notes as a dual-recourse funding instrument for SMEs for long-term financing could be explored, taking due account of financial stability risks;

    12.  Underlines that financial literacy is essential in modern economies, contributing to the resilience of the banking systems across Member States and encouraging cross-border financial activity;

    13.  Underlines that a high level of consumer protection will make the BU more resilient;

    14.  Takes the view that the Commission should focus on aspects that contribute to achieving the goals of digitalisation, modernisation, simplification, streamlining and increased competitiveness; maintains that legal certainty, security, predictability and stability are essential for EU banks to be able to operate under favourable conditions;

    15.  Notes that, in addition to traditional loans, diverse sources of financing can be beneficial for EU growth and EU competitiveness, and recognises the low-risk nature of asset-backed financing solutions;

    16.   Notes the ECB’s progress on the digital euro and the parliamentary dialogue being held with the ECB on the topic; understands existing reservations, such as with regard to its offline functionality, given that offline transactions reduce visibility and impair financial crime prevention; recalls that the digital euro should complement, not replace, cash; considers that the decision on whether or not to introduce a digital euro is ultimately a political decision that has to be taken by the EU’s co-legislators, given the profound potential impact of this decision on a wide range of EU domains, including privacy, consumer protection, financial stability, financial policy and other areas that go beyond the strict remit of monetary policy;

    17.  Regrets the failure of some financial institutions to ensure gender balance, especially in their management bodies; stresses that gender balance on boards and in the workforce brings both societal and economic returns; calls on financial institutions to regularly update their diversity and inclusion policies and help to foster healthy working cultures that prioritise inclusivity; calls on private and public entities to address the lack of diversity and gender balance in the management bodies of financial institutions;

    Supervision

    18.  Welcomes the adoption by the co-legislators of the new banking package implementing Basel III standards in the EU; notes the current lack of clarity concerning the implementation of the Basel III standards in some other jurisdictions and the potential risk for an international level playing field; stresses that the Commission should evaluate whether targeted changes could help to maintain the international competitiveness of EU banks without weakening their resilience; recalls that the delegated act on the date of application of the own funds requirements for market risk postponed the date of application of the new market risk framework by one year to 1 January 2026; calls on the Commission to assess whether the equivalence decisions taken with the jurisdictions not implementing the Basel III standards need to be reviewed in order to preserve the financial stability of the EU financial sector;

    19.  Acknowledges the growing phenomenon of bank branch closures, which contributes to the risk of ‘bank desertification’ in certain regions, with a particularly negative impact on vulnerable citizens without digital access; emphasises the critical role smaller banks play in ensuring access to essential banking services, especially in rural and remote areas, thereby supporting households, SMEs and local economies; notes that the high supervisory costs and regulatory burdens can pose significant challenges for smaller banks; underscores the need to apply the principle of proportionality in banking supervision, ensuring that the intensity of regulation is tailored to the size, risk profile and business model of institutions, while taking into account the essential territorial role of smaller banks and their specific characteristics;

    20.  Recalls that the Banking Package contains a high number of mandates to the European Banking Authority; calls on the European Banking Authority to respect these mandates;

    21.  Notes that even within the existing regulatory framework the banking sector has shown its resilience during the market events of recent years, and that the average Common Equity Tier 1 ratio has remained at high levels, at 15,81 %;

    22.  Notes that the non-performing loans ratio has remained stable at 2,30 % and the liquidity coverage ratio at 159,39 %;

    23.  Notes the varying levels of exposure to non-performing loans and recalls that there are Member States which have exposure levels in the order of 1 % or even lower, while other Member States have exposure levels exceeding 4 %; considers that efforts to reduce European banks’ exposure to this type of loan should continue as good risk management practice;

    24.  Highlights the fact that adverse macroeconomic conditions, geopolitical headwinds and the rapid development of deferred payment services may lead to a deterioration in asset quality and affect the level of non-performing loans in the future; highlights, therefore, the importance of prudent risk management and appropriate provisioning;

    25.  Notes that the current levels of banking sector profitability may provide an opportunity for an increase in macroprudential buffers and help to preserve banking sector resilience; invites the Commission to further explore this option and carefully evaluate how to revise the macroprudential framework, taking into consideration the potential impact on capital requirements and bearing in mind a level playing field with other jurisdictions;

    26.   Notes that the banking sector plays a role in supporting the transition to a digitalised and carbon neutral economy, in channelling funds to renewable energy sources and in supporting the achievement of the objectives of the EU Green Deal and the EU Climate Law;

    27.  Notes that the ECB takes account of climate- and nature-related financial risks in its supervisory practices and monitors growing physical and transition risks closely;

    28.  Welcomes the idea of increasing venture capital and unlocking capital to finance fast-growing companies in the EU; notes Commission President Ursula von der Leyen’s commitment to put forward risk-absorbing measures to make it easier for commercial banks, investors and venture capital to finance fast-growing companies(15); notes that this must be done in a way that does not pose a systemic risk or moral hazard;

    29.  Welcomes the creation of the new Authority for Anti-Money Laundering and Countering the Financing of Terrorism, which will allow more effective ways to combat money laundering and terrorist financing via direct supervision of certain financial entities and better cooperation, a better flow of information between national authorities and better coordination among sanctions enforcement authorities in Members States to help close gaps in the implementation of targeted sanctions;

    30.  Stresses the need to enhance the resilience of non-bank financial intermediaries, including by designing specific regulatory and supervisory tools; points out that such measures must guarantee the security of the financial system and be in the best interests of the customer; welcomes the Commission consultation on macroprudential policies for non-bank financial intermediaries; supports the Eurosystem’s recommendation to introduce system-wide stress tests to identify and quantify risks to the resilience of core markets; invites the Commission to investigate whether there are any gaps in the supervisory toolkit, including in relation to potential liquidity crunches and implications for systemic risk;

    31.  Notes that crypto-assets create new challenges and opportunities for the financial system but also pose risks to it, and that these require attention from the national supervisors, the SSM and the European Systemic Risk Board;

    Resolution

    32.  Recalls that the position adopted by Parliament in April 2024 on the crisis management and deposit insurance framework ensures a more consistent approach across all Member States to the application of resolution tools and deposit protection to enhance financial stability, taxpayer protection and depositor confidence; notes that small banks have some specificities that may warrant a proportionate approach; stresses that European and national competent authorities should have at their disposal appropriate and sufficient tools to respond effectively to bank failures and safeguard financial stability, and that banks need to operate in an effective regulatory environment that fosters their development;

    33.  Highlights the importance of preserving shareholders’ and creditors’ primary responsibility for bearing losses in the event of a bank’s failure; stresses that resorting to using taxpayers’ money must be avoided, which is still a key lesson learned from the global financial crisis; stresses that the bail-in of shareholders and creditors must remain the main source for resolution financing before any recourse is made to industry-funded sources;

    34.  Recalls that a sufficient minimum requirement for own funds and eligible liabilities (MREL) is crucial for a credible resolution framework and for ensuring that resolution authorities have sufficient flexibility to effectively apply the resolution strategies needed in a specific crisis situation; underlines that this minimum requirement should be sufficient to effectively implement any of the resolution strategies included in a bank’s resolution plan; recalls that the resolution framework should avoid undue increases in MREL calibration and disproportionate contributions to the Single Resolution Fund;

    35.  Stresses that if a bank’s eligible liabilities are issued to non-EU investors, the write-down or conversion of these liabilities should be enforceable with full certainty to safeguard the effective application of resolution tools;

    36.  Notes that any reliance on taxpayer money for the resolution of banks, including for liquidity support, should be avoided, in keeping with the principles of fiscal and social responsibility and market discipline;

    37.  Recalls that banks need to continue to meet their obligations and perform their key functions after the implementation of a resolution decision;

    38.  Recalls the importance of clarifying the role of the ECB as liquidity provider in resolution, paying due attention to appropriate guarantees and the ECB’s mandate;

    39.  Underlines the SRB’s announcement that it will enhance its capabilities for launching enforcement action to remove substantive impediments to resolvability; calls for the publication, at the end of each resolution planning cycle, of an anonymised list of identified impediments to resolvability and the actions adopted to address them;

    40.  Welcomes the ‘SRM Vision 2028’ strategic review initiated by the SRB to set its long-term goals, address new challenges and further strengthen collaboration with the national resolution authorities and other stakeholders; notes, in particular, the SRB’s intention to identify areas where sustainability can be embedded further in its daily operations and core business; highlights the need to ensure efficiency and cost-effectiveness in the implementation of the new strategy;

    41.  Welcomes the SRB plan to streamline the annual resolution planning cycle to ensure that it is increasingly efficient and has a greater focus on testing banks’ resolvability and the operationalisation of resolution strategies;

    42.  Welcomes the fact that the Single Resolution Fund has now been built up; calls for the full ratification of the Amending Agreement to the ESM Treaty by all Member States, including the establishment of a common backstop to the Single Resolution Fund;

    43.  Highlights the need for additional efforts to ensure full resolvability for all banks falling under the scope of resolution; recalls that achieving resolvability cannot be considered a ‘moving target’ and therefore calls for more standardisation and harmonisation of the resolvability assessment; recalls, nonetheless, the important role played by national resolution authorities in the assessment of resolvability;

    Deposit insurance

    44.  Underlines the fact that the Commission’s proposal to establish a European deposit insurance scheme was published back in 2015 and that the landscape has changed significantly since then;

    45.  Recalls that the position of its Committee on Economic and Monetary Affairs on a European deposit insurance scheme was adopted in April 2024; notes that that position deviates from the Commission’s 2015 proposal and adopts a new approach; is waiting for, and encourages the Council to move forward with, the negotiations on a European deposit insurance scheme;

    46.  Notes that national deposit guarantee schemes were introduced successfully and have proved their functionality in a number of cases; underlines the need to take specific national characteristics into account and to preserve the well-functioning systems for smaller banks that are already in place in some Member States, such as institutional protection schemes, in a way that ensures a level playing field across the BU;

    o
    o   o

    47.  Instructs its President to forward this resolution to the Council, the Commission, the European Central Bank, the Single Resolution Board and the European Banking Authority.

    (1) OJ C, C/2024/5706, 17.10.2024, ELI: http://data.europa.eu/eli/C/2024/5706/oj.
    (2) Directive (EU) 2024/1640 of the European Parliament and of the Council of 31 May 2024 on the mechanisms to be put in place by Member States for the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Directive(EU) 2019/1937, and amending and repealing Directive (EU) 2015/849 (OJ L, 2024/1640, 19.6.2024, ELI: http://data.europa.eu/eli/dir/2024/1640/oj).
    (3) Regulation (EU) 2024/1624 of the European Parliament and of the Council of 31 May 2024 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing (OJ L, 2024/1624, 19.6.2024, ELI: http://data.europa.eu/eli/reg/2024/1624/oj).
    (4) Regulation (EU) 2024/1620 of the European Parliament and of the Council of 31 May 2024 establishing the Authority for Anti-Money Laundering and Countering the Financing of Terrorism and amending Regulations (EU) No 1093/2010, (EU) No 1094/2010 and (EU) No 1095/2010 (OJ L, 2024/1620, 19.6.2024, ELI: http://data.europa.eu/eli/reg/2024/1620/oj).
    (5) Directive (EU) 2024/1619 of the European Parliament and of the Council of 31 May 2024 amending Directive 2013/36/EU as regards supervisory powers, sanctions, third-country branches, and environmental, social and governance risks (OJ L, 2024/1619, 19.6.2024, ELI: http://data.europa.eu/eli/dir/2024/1619/oj).
    (6) Regulation (EU) 2024/1623 of the European Parliament and of the Council of 31 May 2024 amending Regulation (EU) No 575/2013 as regards requirements for credit risk, credit valuation adjustment risk, operational risk, market risk and the output floor (OJ L, 2024/1623, 19.6.2024, ELI: http://data.europa.eu/eli/reg/2024/1623/oj).
    (7) OJ L 2024/2795, 31.10.2024, ELI: http://data.europa.eu/eli/reg_del/2024/2795/oj.
    (8) Texts adopted, P9_TA(2024)0326.
    (9) Texts adopted, P9_TA(2024)0327.
    (10) Texts adopted, P9_TA(2024)0328.
    (11) Véron, N., ‘Europe’s banking union at ten: unfinished yet transformative’, Peterson Institute for International Economics Working Paper No 24-15, June 2024.
    (12) OJ C 23, 21.1.2021, p. 105.
    (13) OJ C 494, 8.12.2021, p. 118.
    (14) Draghi report, p. 61.
    (15) Von der Leyen, Ursula, Europe’s Choice: Political Guidelines for the next European Commission 2024-2029, p. 11.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – Ninth report on economic and social cohesion – P10_TA(2025)0098 – Thursday, 8 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to Articles 2 and 3 of the Treaty on European Union,

    –  having regard to Articles 4, 162, 174 to 178, and 349 of the Treaty on the Functioning of the European Union (TFEU),

    –  having regard to Regulation (EU) 2021/1060 of the European Parliament and of the Council of 24 June 2021 laying down common provisions on the European Regional Development Fund, the European Social Fund Plus, the Cohesion Fund, the Just Transition Fund and the European Maritime, Fisheries and Aquaculture Fund and financial rules for those and for the Asylum, Migration and Integration Fund, the Internal Security Fund and the Instrument for Financial Support for Border Management and Visa Policy(1) (Common Provisions Regulation),

    –  having regard to Regulation (EU) 2021/1058 of the European Parliament and of the Council of 24 June 2021 on the European Regional Development Fund and on the Cohesion Fund(2),

    –  having regard to Regulation (EU) 2021/1059 of the European Parliament and of the Council of 24 June 2021 on specific provisions for the European territorial cooperation goal (Interreg) supported by the European Regional Development Fund and external financing instruments(3),

    –  having regard to Regulation (EU) 2021/1057 of the European Parliament and of the Council of 24 June 2021 establishing the European Social Fund Plus (ESF+) and repealing Regulation (EU) No 1296/2013(4),

    –  having regard to Regulation (EU) 2021/1056 of the European Parliament and of the Council of 24 June 2021 establishing the Just Transition Fund(5),

    –  having regard to Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing Regulations (EU) No 1305/2013 and (EU) No 1307/2013(6),

    –  having regard to Regulation (EU) 2020/460 of the European Parliament and of the Council of 30 March 2020 amending Regulations (EU) No 1301/2013, (EU) No 1303/2013 and (EU) No 508/2014 as regards specific measures to mobilise investments in the healthcare systems of Member States and in other sectors of their economies in response to the COVID-19 outbreak (Coronavirus Response Investment Initiative)(7),

    –  having regard to Regulation (EU) 2020/558 of the European Parliament and of the Council of 23 April 2020 amending Regulations (EU) No 1301/2013 and (EU) No 1303/2013 as regards specific measures to provide exceptional flexibility for the use of the European Structural and Investments Funds in response to the COVID-19 outbreak(8),

    –  having regard to Regulation (EU) 2020/461 of the European Parliament and of the Council of 30 March 2020 amending Council Regulation (EC) No 2012/2002 in order to provide financial assistance to Member States and to countries negotiating their accession to the Union that are seriously affected by a major public health emergency(9),

    –  having regard to Regulation (EU) 2020/2221 of the European Parliament and of the Council of 23 December 2020 amending Regulation (EU) No 1303/2013 as regards additional resources and implementing arrangements to provide assistance for fostering crisis repair in the context of the COVID-19 pandemic and its social consequences and for preparing a green, digital and resilient recovery of the economy (REACT-EU)(10),

    –  having regard to Regulation (EU) 2022/562 of the European Parliament and of the Council of 6 April 2022 amending Regulations (EU) No 1303/2013 and (EU) No 223/2014 as regards Cohesion’s Action for Refugees in Europe (CARE)(11),

    –  having regard to Regulation (EU) 2022/2039 of the European Parliament and of the Council of 19 October 2022 amending Regulations (EU) No 1303/2013 and (EU) 2021/1060 as regards additional flexibility to address the consequences of the military aggression of the Russian Federation FAST (Flexible Assistance for Territories) – CARE(12),

    –  having regard to the URBACT programme for sustainable urban cooperation, established in 2002,

    –  having regard to the Urban Agenda for the EU of 30 May 2016,

    –  having regard to the Territorial Agenda 2030 of 1 December 2020,

    –  having regard to the 9th Cohesion Report, published by the Commission on 27 March 2024(13), and the Commission communication of 27 March 2024 on the 9th Cohesion Report (COM(2024)0149),

    –  having regard to the study entitled ‘The future of EU cohesion: Scenarios and their impacts on regional inequalities’, published by the European Parliamentary Research Service in December 2024,

    –  having regard to the Commission report of February 2024 entitled ‘Forging a sustainable future together – Cohesion for a competitive and inclusive Europe’(14),

    –  having regard to the opinion of the European Economic and Social Committee of 31 May 2024 on the 9th Cohesion Report(15),

    –  having regard to the opinion of the Committee of the Regions of 21 November 2024 entitled ‘A renewed Cohesion Policy post 2027 that leaves no one behind – CoR responses to the 9th Cohesion Report and the Report of the Group of High-Level Specialists on the Future of Cohesion Policy’,

    –  having regard to the report entitled ‘The future of European competitiveness – A competitiveness strategy for Europe’, published by the Commission on 9 September 2024,

    –  having regard to the agreement adopted at the 21st Conference of the Parties to the UN Framework Convention on Climate Change (COP21) in Paris on 12 December 2015 (the Paris Agreement),

    –  having regard to the study entitled ‘Streamlining EU Cohesion Funds: addressing administrative burdens and redundancy’, published by its Directorate-General for Internal Policies of the Union in November 2024(16),

    –  having regard to a Regulation of the European Parliament and of the Council of 7 May 2025 on the Border Regions’ Instrument for Development and Growth in the EU (BRIDGEforEU)(17),

    –  having regard to the Commission communication of 3 May 2022 entitled ‘Putting people first, securing sustainable and inclusive growth, unlocking the potential of the EU’s outermost regions’ (COM(2022)0198),

    –  having regard to the opinion in the form of a letter from the Committee on Agriculture and Rural Development(18),

    –  having regard to its resolution of 25 March 2021 on cohesion policy and regional environment strategies in the fight against climate change(19),

    –  having regard to its resolution of 20 May 2021 on reversing demographic trends in EU regions using cohesion policy instruments(20),

    –  having regard to its resolution of 14 September 2021 entitled ‘Towards a stronger partnership with the EU outermost regions(21),

    –  having regard to its resolution of 15 September 2022 on economic, social and territorial cohesion in the EU: the 8th Cohesion Report(22),

    –  having regard to its resolution of 21 November 2023 on possibilities to increase the reliability of audits and controls by national authorities in shared management(23),

    –  having regard to its resolution of 23 November 2023 on harnessing talent in Europe’s regions(24),

    –  having regard to its resolution of 14 March 2024 entitled ‘Cohesion policy 2014-2020 – implementation and outcomes in the Member States(25),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Regional Development (A10-0066/2025),

    A.  whereas cohesion policy is at the heart of EU policies and is the EU’s main tool for investments in sustainable economic, social and territorial development, and contributing to the Green Deal objectives, across the EU under its multiannual financial frameworks for the periods of 2014-2020 and 2021-2027; whereas cohesion policy, as mandated by the Treaties, is fundamental for a well-functioning and thriving internal market by promoting the development of all regions in the EU, and especially the less developed ones;

    B.  whereas cohesion policy has fostered economic, social and territorial convergence in the EU, notably by increasing the gross domestic products, for example, of central and eastern EU Member States, which went from 43 % of the EU average in 1995 to around 80 % in 2023; whereas the 9th Cohesion Report highlights that, by the end of 2022, cohesion policy supported over 4,4 million businesses, creating more than 370 000 jobs in these companies; whereas it also underlines that cohesion policy generates a significant return on investment, and that each euro invested in the 2014–2020 and 2021–2027 programmes will have generated 1,3 euros of additional GDP in the Union by 2030; whereas cohesion policy constituted, on average, around 13 % of total public investment in the EU(26);

    C.  whereas the Commission report entitled ‘The long-term vision for the EU’s rural areas: key achievements and ways forward’, presented alongside the ninth Cohesion Report, underlines that EUR 24,6 billion, or 8 % of the rural development pillar of the common agricultural policy, is directed towards investments in rural areas beyond farming investments, setting the scene for a debate on the future of rural areas;

    D.  whereas between 2021 and 2027, cohesion policy will have invested over EUR 140 billion in the green and digital transitions(27), to help improve networks and infrastructure, support nature conservation, improve green and digital skills and foster job creation and services for the public;

    E.  whereas despite the widely acknowledged and proven positive impact of cohesion policy on social, economic and territorial convergence, significant challenges remain, marked notably by development disparities at sub-national level, within regions and in regions caught in a development trap, and by the impact of climate change, in terms of demography, the digital and green transitions, and connectivity, but also in terms of sustainable economic development, in particular in least developed regions and rural and remote areas;

    F.  whereas cohesion policy and sectoral programmes of the EU have repeatedly and efficiently helped regions to respond effectively to emergencies and asymmetric shocks such as the COVID-19 crisis, Brexit, the energy crisis and the refugee crisis caused by Russia’s invasion of Ukraine, as well as natural disasters, even though it is a long-term, structural policy and not a crisis management instrument or the ‘go-to’ emergency response funding mechanism; whereas such crises have delayed the implementation of the European Structural and Investment Funds and whereas a considerable number of projects financed with Recovery and Resilience Facility (RRF) funds have been taken for the most part from projects that had been slated for investment under cohesion policy;

    G.  whereas despite measures already taken for the 2014-2020 and 2021-2027 periods, the regulatory framework governing the use and administration of cohesion policy instruments and funds should be further simplified and interoperable digital tools better used and developed, including the establishment of one-stop digitalised service centres, with the objective of streamlining procedures, enhancing stakeholder trust, reducing the administrative burden, increasing flexibility in fund management and speeding up payments, not only for the relevant authorities but also for the final beneficiaries; whereas it is necessary to increase the scope for using funds more flexibly, including the possibility of financing the development of dual-use products; whereas it is of utmost importance to formulate any future cohesion policy with a strategic impetus throughout the funding period, which could, however, be reassessed at midterm;

    H.  whereas the low absorption rate of the 2021-2027 cohesion policy funds, currently at just 6 %, is not because of a lack of need from Member States or regions, but rather stems from delays in the approval of operational programmes, the transition period between financial frameworks, the prioritisation of NextGenerationEU by national managing authorities, limited administrative capacity and complex bureaucratic procedures; whereas Member States and regions may not rush to absorb all available funds as they anticipate a possible extension under the N+2 or N+3 rules;

    I.  whereas radical modifications to the cohesion regulatory framework, from one programming period to the next, contribute to generating insecurity among the authorities responsible and beneficiaries, gold-plating legislation, increasing error rates (and the accompanying negative reputational and financial consequences), delays in implementation and, ultimately, disaffection among beneficiaries and the general population;

    J.  whereas there is sometimes competition between cohesion funds, emergency funds and sectoral policies;

    K.  whereas demographic changes vary significantly across EU regions, with the populations of some Member States facing a projected decline in the coming years and others projected to grow; whereas demographic changes also take place between regions, including movement away from outermost regions, but are generally observed as movement from rural to urban areas within Member States, wherein women are leaving rural areas in greater numbers than men, but also to metropolitan areas, where villages around big cities encounter difficulties in investing in basic infrastructure; whereas the provision of essential services such as healthcare, education and transportation must be reinforced in all regions, with a particular focus on rural and remote areas; whereas a stronger focus is needed on areas suffering from depopulation and inadequate services, requiring targeted measures to encourage young people to remain through entrepreneurship projects, high-quality agriculture and sustainable tourism;

    L.  whereas taking account of the ageing population is crucial in order to ensure justice among the generations and thereby to strengthen participation, especially among young people;

    M.  whereas urban areas are burdened by new challenges resulting from the population influx to cities, as well as rising housing and energy prices, requiring the necessary housing development, new environmental protection and energy-saving measures, such as accelerated deep renovation to combat energy poverty and promote energy efficiency; whereas the EU cohesion policy should help to contribute to an affordable and accessible housing market for all people in the EU, especially for low- and middle-income households, urban residents, families with children, women and young people;

    N.  whereas effective implementation of the Urban Agenda for the EU can enhance the capacity of cities to contribute to cohesion objectives, thereby improving the quality of life of citizens and guaranteeing a more efficient use of the EU’s financial resources;

    O.  whereas particular attention needs to be paid to rural areas, as well as areas affected by industrial transition and EU regions that suffer from severe and permanent natural or demographic handicaps, brain drain, climate-related risks and water scarcity, such as the outermost regions, and in particular islands located at their peripheries or at the periphery of the EU, sparsely populated regions, islands, mountainous areas and cross-border regions, as well as coastal and maritime regions;

    P.  whereas Russia’s war of aggression against Ukraine has created a new geopolitical reality that has had a strong impact on the employment, economic development and opportunities, and general well-being of the population living in regions bordering Ukraine, Belarus and Russia, as well as candidate countries such as Ukraine and Moldova, which therefore require special attention and support, including by accordingly adapting cohesion policy; whereas this war has led to an unprecedented number of people seeking shelter in the EU, placing an additional burden on local communities and services; whereas the collective security of the EU is strongly dependent on the vitality and well-being of regions situated at the EU’s external borders;

    Q.  whereas the unique situation of Northern Ireland requires a bespoke approach building on the benefits of PEACE programmes examining how wider cohesion policy can benefit the process of reconciliation;

    R.  whereas 79 % of citizens who are aware of EU-funded projects under cohesion policy believe that EU-funded projects have a positive impact on the regions(28), which contributes to a pro-EU attitude;

    S.  whereas overall awareness of EU-funded projects under cohesion policy has decreased by 2 percentage points since 2021(29), meaning that greater decentralisation should be pursued to bring cohesion policy even closer to the citizen;

    1.  Insists that the regional and local focus, place-based approach and strategic planning of cohesion policy, as well as its decentralised programming and implementation model based on the partnership principle with strengthened implementation of the European code of conduct, the involvement of economic and civil society actors, and multi-level governance, are key and positive elements of the policy, and determine its effectiveness; is firmly convinced that this model of cohesion policy should be continued in all regions and deepened where possible as the EU’s main long-term investment instrument for reducing disparities, ensuring economic, social and territorial cohesion, and stimulating regional and local sustainable growth in line with EU strategies, protecting the environment, and as a key contributor to EU competitiveness and just transition, as well as helping to cope with new challenges ahead;

    2.  Calls for a clear demarcation between cohesion policy and other instruments, in order to avoid overlaps and competition between EU instruments, ensure complementarity of the various interventions and increase visibility and readability of EU support; in this context, notes that the RRF funds are committed to economic development and growth, without specifically focusing on economic, social and territorial cohesion between regions; is concerned about the Commission’s plans to apply a performance-based approach to the European Structural and Investment Funds (ESIF); acknowledges that performance-based mechanisms can be instrumental in making the policy more efficient and results-orientated, but cautions against a one-size-fits-all imposition of the model and expresses serious doubt about ideas to link the disbursement of ESIF to the fulfilment of centrally defined reform goals, even more so if the reform goals do not fall within the scope of competence of the regional level;

    3.  Is opposed to any form of top-down centralisation reform of EU funding programmes, including those under shared management, such as the cohesion policy and the common agricultural policy, and advocates for greater decentralisation of decision-making to the local and regional levels; calls for enhanced involvement of local and regional authorities and economic and civil society actors at every stage of EU shared management programmes, from preparation and programming to implementation, delivery and evaluation, keeping in mind that the economic and social development of, and territorial cohesion between, regions can only be accomplished on the basis of good cooperation between all actors;

    4.  Emphasises that the European Agricultural Fund for Rural Development (EAFRD) plays a key role, alongside cohesion policy funds, in supporting rural areas; stresses that the EAFRD’s design must align with the rules of cohesion policy funds to boost synergies and facilitate multi-funded rural development projects;

    5.  Is convinced that cohesion policy can only continue to play its role if it has solid funding; underlines that this implies that future cohesion policy must be provided with robust funding for the post-2027 financial period; stresses that it is necessary to provide funding that is ambitious enough and easily accessible to allow cohesion policy to continue to fulfil its role as the EU’s main investment policy, while retaining the flexibility to meet potential new challenges, including the possibility of financing the development of dual-use products, and to enable local authorities, stakeholders and beneficiaries to effectively foster local development; is of the firm opinion that the capacity to offer flexible responses to unpredictable challenges should not come at the expense of the clear long-term strategic focus and objectives of cohesion policy;

    6.  Underlines the importance of the next EU multiannual financial framework (MFF) and the mid-term review of cohesion policy programmes 2021-2027 in shaping the future of cohesion policy; reiterates the need for a more ambitious post-2027 cohesion policy in the next MFF 2028-2034; calls, therefore, for the upcoming MFF to ensure that cohesion policy continues to receive at least the same level of funding as in the current period in real terms; furthermore calls for cohesion policy to remain a separate heading in the new MFF; stresses that cohesion policy should be protected from statistical effects that may alter the eligibility of regions by changing the average EU GDP; reiterates the need for new EU own resources;

    7.  Proposes, therefore, that next MFF be more responsive to unforeseen needs, including with sufficient margins and flexibilities from the outset; emphasises in this regard, however, that cohesion policy is not a crisis instrument and that it should not deviate from its main objectives, namely from its long-term investment nature; calls for the European Union Solidarity Fund to be strengthened, including in its pre-financing, making it less bureaucratic and more easily accessible, in order to develop an appropriate instrument capable of responding adequately to the economic, social and territorial consequences of future natural disasters or health emergencies; emphasises the need for Parliament to have adequate control over any emergency funds and instruments;

    8.  Recognises the need to also use nomenclature of territorial units for statistics (NUTS) 3 classification for specific cases, in a manner that recognises that inequalities in development exist within all NUTS 2 regions; is of the opinion that regional GDP per capita must remain the main criterion for determining Member States’ allocations under cohesion policy; welcomes the fact that, following Parliament’s persistent calls, the Commission has begun considering additional criteria(30) such as greenhouse gas emissions, population density, education levels and unemployment rates, in order to provide a better socio-economic overview of the regions;

    9.  Stresses that the rule of law conditionality is an overarching conditionality, recognising and enforcing respect for the rule of law, also as an enabling condition for cohesion policy funding, to ensure that Union resources are used in a transparent, fair and responsible manner with sound financial management; considers it necessary to reinforce respect for the rule of law and fundamental rights, and to ensure that all actions are consistent with supporting democratic principles, gender equality and human rights, including workers’ rights, the rights of disabled people and children’s rights, in the implementation of cohesion policy; highlights the important role of the European Anti-Fraud Office and the European Public Prosecutor’s Office in protecting the financial interests of the Union;

    10.  Calls for further efforts to simplify, make more flexible, strengthen synergies and streamline the rules and administrative procedures governing cohesion policy funds at EU, national and regional level, taking full advantage of the technologies available to increase accessibility and efficiency, building on the existing and well-established shared management framework, in order to strengthen confidence among users, thus encouraging the participation of a broader range of economic and civil society actors in projects supported and maximising the funds’ impact; calls for further initiatives enabling better absorption of cohesion funds, including increased co-financing levels, higher pre-financing and faster investment reimbursements; calls for local administration, in particular representing smaller communities, to be technically trained for better administrative management of the funds; stresses, therefore, the importance of strengthening the single audit principle, further expanding simplified cost options and reducing duplicating controls and audits that overlap with national and regional oversight for the same project and beneficiary, with a view to eliminating the possibility of repeating errors in subsequent years of implementation;

    11.  Calls on the Commission and the Member States to give regions greater flexibility already at the programming stage, in order to cater for their particular needs and specificities, emphasising the need to involve the economic and civil society actors; underlines that thematic concentration was a key element in aligning cohesion policy with Europe 2020 objectives; asks the Commission, therefore, to present all findings related to the implementation of thematic concentration and to draw lessons for future legislative proposals;

    12.  Acknowledges that the green, digital and demographic transitions present significant challenges but, at the same time, opportunities to achieve the objective of economic, social and territorial cohesion; recognises that, statistically, high-income areas can hide the economic problems within a region; is aware of the risk of a widening of regional disparities, a deepening of social inequalities and a rising ‘geography of discontent’ related to the transition process; underlines the need to reach the EU’s sustainability and climate objectives, and to maintain shared economic growth by strengthening the Union’s competitiveness; calls, therefore, for a European strategy that guarantees harmonious growth within the Union, meeting the respective regions’ specific needs; reaffirms its commitment to pursuing the green and digital transitions, as this will create opportunities to improve the EU’s competitiveness; underlines the need to invest in infrastructure projects that enhance connectivity, particularly in sustainable, intelligent transport, and in energy and digital networks, ensuring that all regions, including remote and less-developed ones, are fully integrated into the single market and benefit equitably from the opportunities it provides; emphasises, in this context, the need to support the development of green industries, fostering local specificities and traditions to increase the resilience of the economic environment and civil society to future challenges;

    13.  Urges that the cohesion policy remain consistent with a push towards increasing innovation and completing the EU single market, in line with the conclusions of the Draghi report on European competitiveness; underlines, in the context of regional disparities, the problem of the persisting innovation divide and advocates for a tailored, place-based approach to fostering innovation and economic convergence across regions and reducing the innovation gap; calls for a stronger role for local and regional innovation in building competitive research and innovation ecosystems and promoting territorial cohesion; points to new EU initiatives, such as regional innovation valleys and partnerships for regional innovation, that aim to connect territories with different levels of innovation performance and tackle the innovation gap; considers that this approach will reinforce regional autonomy, allowing local and regional authorities to shape EU policies and objectives in line with their specific needs, characteristics and capacities, while safeguarding the partnership principle;

    14.  Is convinced that cohesion policy needs to continue to foster the principle of just transition, addressing the specific needs of regions, while leaving no territory and no one behind; calls for continued financing of the just transition process, with the Just Transition Fund being fully integrated into the Common Provisions Regulation and endowed with reinforced financial means for the post-2027 programming period; emphasises, nonetheless, the need to assess the impact of the Just Transition Fund on the transformation of eligible regions and, while ensuring it remains part of cohesion policy, refine its approach in the new MFF on the basis of the findings and concrete measures to ensure the economic and social well-being of affected communities;

    15.  Underlines the need to improve the relationship between cohesion policy and EU economic governance, while avoiding a punitive approach; stresses that the European Semester should comply with cohesion policy objectives under Articles 174 and 175 TFEU; calls for the participation of the regions in the fulfilment of these objectives and for a stronger territorial approach; calls for a process of reflection on the concept of macroeconomic conditionality and for the possibility to be explored of replacing this concept with new forms of conditionality to better reflect the new challenges ahead;

    16.  Is concerned about the growing number of regions in a development trap, which are stagnating economically and are suffering from sharp demographic decline and limited access to essential services; calls, therefore, for an upward adjustment in co-financing for projects aimed at strengthening essential services; stresses the role of cohesion policy instruments in supporting different regions and local areas that are coping with demographic evolution affecting people’s effective right to stay, including, among others, challenges related to depopulation, ageing, gender imbalances, brain drain, skills shortages and workforce imbalances across regions; recognises the need for targeted economic incentives and structural interventions to counteract these phenomena; in this context, calls for the implementation of targeted programmes to attract, develop and retain talent, particularly in regions experiencing significant outflows of skilled workers, by fostering education, culture, entrepreneurship and innovation ecosystems that align with local and regional economic needs and opportunities;

    17.  Recognises the importance of supporting and financing specific solutions for regions with long-standing and serious economic difficulties or severe permanent natural and demographic handicaps; reiterates the need for maintaining and improving the provision of quality essential services (such as education and healthcare), transport and digital connectivity of these regions, fostering their economic diversification and job creation, and helping them respond to challenges such as rural desertification, population ageing, poverty, depopulation, loneliness and isolation, as well as the lack of opportunities for vulnerable people such as persons with disabilities; underlines the need to prioritise the development and adequate funding of strategic sectors, such as renewable energy, sustainable tourism, digital innovation and infrastructure, in a manner that is tailored to the economic potential and resources of each region, in order to create broader conditions for endogenous growth and balanced development across all regions, especially rural, remote and less-developed areas, border regions, islands and outermost regions; recalls the importance of strong rural-urban linkages and particular support for women in rural areas;

    18.  Emphasises the need for a tailored approach for the outermost regions, as defined under Article 349 TFEU, which face unique and cumulative structural challenges due to their remoteness, small market size, vulnerability to climate change and economic dependencies; underlines that these permanent constraints, including the small size of the domestic economy, great distance from the European continent, location near third countries, double insularity for most of them, and limited diversification of the productive sector, result in additional costs and reduced competitiveness, making their adaptation to the green and digital transition particularly complex and costly; underlines their great potential to further develop, inter alia through improved regional connectivity, key sectors such as blue economy, sustainable agriculture, renewable energies, space activities, research or eco-tourism; reiterates its long-standing call on the Commission to duly consider the impact of all newly proposed legislation on the outermost regions, with a view to avoiding disproportionate regulatory burdens and adverse effects on these regions’ economies;

    19.  Underlines the fact that towns, cities and metropolitan areas have challenges of their own, such as considerable pockets of poverty, housing problems, traffic congestion and poor air quality, generating challenges for social and economic cohesion created by inharmonious territorial development; emphasises the need for a specific agenda for cities and calls for deepening their links with functional urban areas, encompassing smaller cities and towns, to ensure that economic and social benefits are spread more evenly across the entire territory; highlights the need to strengthen coordination between the initiatives of the Urban Agenda for the EU and the instruments of cohesion policy, favouring an integrated approach that takes into account territorial specificities and emerging challenges; calls, furthermore, for more direct access to EU funding for regional and local authorities, as well as cities and urban authorities, by inter alia widening the use of integrated territorial investments (ITI);

    20.  Stresses the need to continue and strengthen investments in affordable housing within the cohesion policy framework, recognising its significance for both regions and cities; highlights the need to foster its changes relevant to investing in housing beyond the two current possibilities (energy efficiency and social housing); emphasises the important role that cohesion policy plays in the roll-out and coordination of these initiatives; believes, furthermore, that it is important to include housing affordability in the URBACT initiative;

    21.  Stresses the strategic importance of strong external border regions for the security and resilience of the EU; calls on the Commission to support the Member States and regions affected by Russia’s war of aggression against Ukraine, in particular the regions on the EU’s eastern border, by revising the Guidelines on regional State aid(31), through tailor-made tools and investments under the cohesion policy, as well as supporting them to make the most of the possibilities offered by the cohesion policy funds, including Interreg, in a flexible way, to help cope with the detrimental socio-economic impact of the war on their populations and territories; calls, furthermore, for support to be given to regions bordering candidate countries such as Ukraine and Moldova to strengthen connections and promote their EU integration;

    22.  Highlights the added value of territorial cooperation in general and cross-border cooperation in particular; underlines the importance of Interreg for cross-border regions, including outermost regions; emphasises its important role in contributing to their development and overcoming cross-border obstacles, including building trust across borders, developing transport links, identifying and reducing legal and administrative obstacles and increasing the provision and use of cross-border public services, among others; considers Interreg as the main EU instrument for tackling the persistent cross-border obstacles faced by emergency services, and proposes that there be a more prominent focus on these services; underlines the fact that cross-border areas, including areas at the EU’s external borders, bordering aggressor countries often face specific challenges; believes that EU border regions, facing multiple challenges, must be supported and is of the opinion that they must be provided with increased means; welcomes the new regulation on BRIDGEforEU; emphasises the importance of small-scale and cross-border projects and stresses the need for effective implementation on the ground; calls on the Commission to encourage Member States to actively support awareness-raising campaigns in bordering regions to maximise the impact of cross-border cooperation;

    23.  Recalls the need to ‘support cohesion’, rather than just rely on the ‘do no harm to cohesion’ principle, which means that no action should hamper the convergence process or contribute to regional disparities; calls for a stronger integration of these principles as cross-cutting in all EU policies, to ensure that they support the objectives of social, economic and territorial cohesion, as set out in Articles 3 and 174 TFEU; calls, furthermore, on the Commission to issue specific guidelines on how to implement and enforce these principles across EU policies, paying particular attention to the impact of EU laws on the competitiveness of less developed regions; reiterates that new legislative proposals need to take due account of local and regional realities; suggests that the Commission draw on innovative tools such as RegHUB (the network of regional hubs) to collect data on the impact of EU policies on the regions; to this end, underlines the need to strengthen the territorial impact assessment of EU legislation, with a simultaneous strengthening of the territorial aspects of other relevant policies; insists that promoting cohesion should also be seen as a way of fostering solidarity and mutual support among Member States and their regions; calls on the Commission and the Member States to continue their efforts regarding communication and visibility of the benefits of cohesion policy, demonstrating to citizens the EU’s tangible impact and serving as a key tool in addressing Euroscepticism; welcomes the launch of the multilingual version of the Kohesio platform;

    24.  Notes with concern the severe decline in recent years of adequate levels of national funding by Member States towards their poorer regions; recalls the importance of respecting the EU rule on additionality; calls on the Commission to ensure that national authorities take due account of internal cohesion in drafting and implementing structural and investment fund projects;

    25.  Insists that, in addition to adjusting to regional needs, cohesion policy must be adapted to the smallest scale, i.e. funds must be accessible to the smallest projects and project bearers; points out that their initiatives are often the most innovative and have a significant impact on rural development; reiterates that these funds should be accessible to all, regardless of their size or scope; approves of the Cohesion Alliance’s call for ‘a post-2027 Cohesion Policy that leaves no one behind’;

    26.  Stresses that delays in the MFF negotiations, together with the fact that Member States have placed a greater focus on the programming of the RRF funds, led to considerable delays in the programming period 2021-2027; stresses the importance of a timely agreement in the next framework, and therefore calls for the Common Provisions Regulation (CPR) and the budget negotiations to be finalised at least one year before the start of the new funding period so that Member States can develop their national and regional funding strategies in good time to ensure a successful transition to the next funding period and the continuation of existing ESIF projects;

    27.  Instructs its President to forward this resolution to the Council, the Commission, the European Economic and Social Committee, the European Committee of the Regions and the national and regional parliaments of the Member States.

    (1) OJ L 231, 30.6.2021, p. 159, ELI: http://data.europa.eu/eli/reg/2021/1060/oj.
    (2) OJ L 231, 30.6.2021, p. 60, ELI: http://data.europa.eu/eli/reg/2021/1058/oj.
    (3) OJ L 231, 30.6.2021, p. 94, ELI: http://data.europa.eu/eli/reg/2021/1059/oj.
    (4) OJ L 231, 30.6.2021, p. 21, ELI: http://data.europa.eu/eli/reg/2021/1057/oj.
    (5) OJ L 231, 30.6.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/1056/oj.
    (6) OJ L 435, 6.12.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/2115/oj.
    (7) OJ L 99, 31.3.2020, p. 5, ELI: http://data.europa.eu/eli/reg/2020/460/oj.
    (8) OJ L 130, 24.4.2020, p. 1, ELI: http://data.europa.eu/eli/reg/2020/558/oj.
    (9) OJ L 99, 31.3.2020, p. 9, ELI: http://data.europa.eu/eli/reg/2020/461/oj.
    (10) OJ L 437, 28.12.2020, p. 30, ELI: http://data.europa.eu/eli/reg/2020/2221/oj.
    (11) OJ L 109, 8.4.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/562/oj.
    (12) OJ L 275, 25.10.2022, p. 23, ELI: http://data.europa.eu/eli/reg/2022/2039/oj.
    (13) European Commission: Directorate-General for Regional and Urban Policy, Ninth report on economic, social and territorial cohesion, 2024.
    (14) European Commission: Directorate-General for Regional and Urban Policy, Forging a sustainable future together: Cohesion for a competitive and inclusive Europe – Report of the High-Level Group on the Future of Cohesion Policy, February 2024.
    (15) OJ C, C/2024/4668, 9.8.2024, ELI: http://data.europa.eu/eli/C/2024/4668/oj.
    (16) European Parliament: Policy Department for Structural and Cohesion Policies, Directorate-General for Internal Policies, Streamlining EU Cohesion funds – addressing administrative burdens and redundancy, 2024.
    (17) Not yet published in the Official Journal.
    (18) Not yet published in the Official Journal.
    (19) OJ C 494, 8.12.2021, p. 26.
    (20) OJ C 15, 12.1.2022, p. 125.
    (21) OJ C 117, 11.3.2022, p. 18.
    (22) OJ C 125, 5.4.2023, p. 100.
    (23) OJ C, C/2024/4207, 24.7.2024, ELI: http://data.europa.eu/eli/C/2024/4207/oj.
    (24) OJ C, C/2024/4225, 24.7.2024, ELI: http://data.europa.eu/eli/C/2024/4225/oj.
    (25) OJ C, C/2024/6562, 12.11.2024, ELI: http://data.europa.eu/eli/C/2024/6562/oj.
    (26) European Commission, Ninth report on economic, social and territorial cohesion, op.cit.
    (27) European Commission: Ninth report on economic, social and territorial cohesion, op. cit.
    (28) European Commission: Directorate-General for Regional and Urban Policy and Directorate-General for Communication, Citizens’ awareness and perceptions of EU Regional Policy, Flash Eurobarometer 531, 2023.
    (29) Flash Eurobarometer 531, op. cit.
    (30) European Court of Auditors, Rapid case review – Allocation of Cohesion policy funding to Member States for 2021-2027, March 2019.
    (31) Commission communication of 29 April 2021 entitled ‘Guidelines on regional State aid’ (OJ C 153, 29.4.2021, p. 1).

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – The European Water Resilience Strategy – P10_TA(2025)0091 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Treaty of the Functioning of the European Union (TFEU), in particular Article 191 thereof,

    –  having regard to the Agreement adopted at the 21st Conference of the Parties to the UNFCCC (COP21) in Paris on 12 December 2015 (the Paris Agreement),

    –  having regard to the United Nations 2030 Agenda for Sustainable Development and the Sustainable Development Goals (SDGs), with particular emphasis on the SDG 6 on clean water and sanitation,

    –  having regard to the Kunming-Montreal Global Biodiversity Framework, adopted in December 2022,

    –  having regard to the Stockholm Convention on Persistent Organic Pollutants of 22 May 2001,

    –  having regard to the precautionary principle and the principles that preventive action should be taken, that environmental damage should, as a priority, be rectified at source and that the polluter should pay, as enshrined in Article 191(2) TFEU,

    –  having regard to Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (European Climate Law)(1),

    –  having regard to Directive 2000/60/EC of the European Parliament and of the Council of 23 October 2000 establishing a framework for Community action in the field of water policy(2) (Water Framework Directive),

    –  having regard to Directive 2006/118/EC of the European Parliament and of the Council of 12 December 2006 on the protection of groundwater against pollution and deterioration(3) (Groundwater Directive),

    –  having regard to Directive 2008/105/EC of the European Parliament and of the Council of 16 December 2008 on environmental quality standards in the field of water policy, amending and subsequently repealing Council Directives 82/176/EEC, 83/513/EEC, 84/156/EEC, 84/491/EEC, 86/280/EEC and amending Directive 2000/60/EC of the European Parliament and of the Council(4) (Environmental Quality Standards Directive),

    –  having regard to Directive 2007/60/EC of the European Parliament and of the Council of 23 October 2007 on the assessment and management of flood risks(5),

    –  having regard to Directive (EU) 2020/2184 of the European Parliament and of the Council of 16 December 2020 on the quality of water intended for human consumption(6) (Drinking Water Directive),

    –  having regard to Regulation (EU) 2020/741 of the European Parliament and of the Council of 25 May 2020 on minimum requirements for water reuse(7) (Water Reuse Regulation),

    –  having regard to Directive 2008/56/EC of the European Parliament and of the Council of 17 June 2008 establishing a framework for community action in the field of marine environmental policy (Marine Strategy Framework Directive)(8),

    –  having regard to Directive (EU) 2024/3019 of the European Parliament and of the Council of 27 November 2024 concerning urban wastewater treatment(9) (revised Urban Wastewater Treatment Directive),

    –  having regard to Directive (EU) 2024/1785 of the European Parliament and of the Council of 24 April 2024 amending Directive 2010/75/EU on industrial emissions (integrated pollution prevention and control) and Council Directive 1999/31/EC on the landfill of waste(10),

    –  having regard to Council Directive 91/676/EEC of 12 December 1991 concerning the protection of waters against pollution caused by nitrates from agricultural sources(11),

    –  having regard to Regulation (EU) 2024/1991 of the European Parliament and of the Council of 24 June 2024 on nature restoration and amending Regulation (EU) 2022/869(12),

    –  having regard to Directive (EU) 2022/2557 of the European Parliament and of the Council of 14 December 2022 on the resilience of critical entities and repealing Council Directive 2008/114/EC(13) (Critical Entities Resilience Directive),

    –  having regard to Directive (EU) 2022/2555 of the European Parliament and of the Council on 14 December 2022 on measures for a high common level of cybersecurity across the Union, amending Regulation (EU) No 910/2014 and Directive (EU) 2018/1972, and repealing Directive (EU) 2016/1148 (NIS 2 Directive)(14),

    –  having regard to Directive 2009/128/EC of the European Parliament and of the Council of 21 October 2009 establishing a framework for Community action to achieve the sustainable use of pesticides(15),

    –  having regard to Regulation (EU) 2021/2115 of the European Parliament and of the Council of 2 December 2021 establishing rules on support for strategic plans to be drawn up by Member States under the common agricultural policy (CAP Strategic Plans) and financed by the European Agricultural Guarantee Fund (EAGF) and by the European Agricultural Fund for Rural Development (EAFRD) and repealing Regulations (EU) No 1305/2013 and (EU) No 1307/2013(16),

    –  having regard to Commission Regulation (EU) 2024/3190 of 19 December 2024 on the use of bisphenol A (BPA) and other bisphenols and bisphenol derivatives with harmonised classification for specific hazardous properties in certain materials and articles intended to come into contact with food, amending Regulation (EU) No 10/2011 and repealing Regulation (EU) 2018/213(17),

    –  having regard to the Commission communication of 19 February 2021 entitled ‘A Vision for Agriculture and Food’ (COM(2025)0075),

    –  having regard to the Commission communication of 11 December 2019 on the European Green Deal (COM(2019)0640),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’ (COM(2025)0030),

    –  having regard to the Commission communication of 12 May 2021 entitled ‘Pathway to a Healthy Planet for All – EU Action Plan: ‘Towards Zero Pollution for Air, Water and Soil’’ (COM(2021)0400),

    –  having regard to the Commission communication of 24 February 2021 entitled ‘Forging a climate-resilient Europe – the new EU Strategy on Adaptation to Climate Change’ (COM(2021)0082),

    –  having regard to the Commission communication of 18 July 2007 on addressing the challenge of water scarcity and droughts in the European Union (COM(2007)0414),

    –  having regard to the Commission communication of 11 March 2020 entitled ‘A new Circular Economy Action Plan: For a cleaner and more competitive Europe’ (COM(2020)0098),

    –  having regard to the Commission communication of 14 November 2012 entitled ‘A Blueprint to Safeguard Europe’s Water Resources’ (COM(2012)0673),

    –  having regard to the EU biodiversity strategy for 2030,

    –  having regard to the COP29 Declaration on Water for Climate Action, endorsed by the European Union,

    –  having regard to the European Oceans Pact announced by Commission President von der Leyen in her political guidelines for the next European Commission (2024-2029) on 18 July 2024,

    –  having regard to the European climate adaptation plan and the European water resilience strategy announced by Commission President von der Leyen in her political guidelines for the next European Commission (2024-2029) on 18 July 2024,

    –  having regard to the EU’s 8th environment action programme,

    –  having regards to its resolution of 5 October 2022 entitled ‘Access to water as a human right – the external dimension’(18),

    –  having regard to its resolution of 19 September 2024 on the devastating floods in central and eastern Europe, the loss of lives and the EU’s preparedness to act on such disasters exacerbated by climate change(19),

    –  having regard to its resolution of 6 October 2022 on momentum for the ocean: strengthening ocean governance and biodiversity(20),

    –  having regard to its resolution of 28 November 2019 on the climate and environment emergency(21),

    –  having regard to its resolution of 14 November 2024 on the UN climate change conference in Baku, Azerbaijan (COP29)(22),

    –  having regard to the Commission report of 4 February 2025 on the implementation of the Water Framework Directive (2000/60/EC) and the Floods Directive (2007/60/EC) entitled ‘Third river basin management plans – Second flood risk management plans’ (COM(2025)0002),

    –  having regard to the European Court of Auditors special report 15/2024 of 16 October 2024 entitled ‘Climate adaptation in the EU – action not keeping up with ambition’,

    –  having regard to former Finnish President Sauli Niinistö’s report of 30 October 2024 entitled ‘Safer Together – Strengthening Europe’s civil and military preparedness and readiness’,

    –  having regard to Enrico Letta’s report of April 2024 entitled ‘Much more than a market’,

    –  having regard to its resolution of 17 December 2020 on the implementation of the EU water legislation(23),

    –  having regard to the European Court of Auditors special report 33/2018 of 18 December 2018 entitled ‘Combating desertification in the EU: a growing threat in need of more action,

    –  having regard to the European citizens’ initiative (ECI) on the right to water,

    –  having regard to its resolution of 8 September 2015 on the follow-up to the European Citizens’ Initiative Right2Water(24),

    –  having regard to UN General Assembly Resolution 64/292 of 28 July 2010, which recognises the human right to water and sanitation,

    –  having regard to the Strategic Dialogue on the future of EU agriculture,

    –  having regard to the European Court of Auditors special report 20/2024 of 30 September 2024 entitled ‘Common Agricultural Policy Plans – Greener, but not matching the EU’s ambitions for the climate and the environment’,

    –  having regard to European Environment Agency report 07/2024 of 15 October 2024 entitled ‘Europe’s state of water 2024: the need for improved water resilience’ (EEA Report 07/2024),

    –  having regard to the Environment Council conclusions of 17 June 2024 on the 8th environment action programme,

    –  having regard to European Court of Auditors special report 20/2021 of 28 September 2021 entitled ‘Sustainable water use in agriculture: CAP funds more likely to promote greater rather than more efficient water use’,

    –  having regard to the European Economic and Social Committee declaration of 26 October 2023 for an EU Blue Deal,

    –  having regard to the Commission proposal of 5 July 2023 for a directive of the European Parliament and of the Council on Soil Monitoring and Resilience (Soil Monitoring Law) (COM(2023)0416),

    –  having regard to its position at first reading of 24 April 2024 on the proposal for a directive of the European Parliament and of the Council amending Directive 2000/60/EC establishing a framework for Community action in the field of water policy, Directive 2006/118/EC on the protection of groundwater against pollution and deterioration and Directive 2008/105/EC on environmental quality standards in the field of water policy(25),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the opinion of the Committee on Agriculture and Rural Development,

    –  having regard to the report of the Committee on the Environment, Climate and Food Safety (A10-0073/2025),

    A.  whereas water is essential for life and humanity; whereas the EU has to manage current and future water resources efficiently and respond effectively to the current water challenges, as they directly affect human health, the environment and its ecosystems, strategic socio-economic activities such as energy production, agriculture and food security, and the EU’s competitiveness;

    B.  whereas water is a scarce and limited resource and, while 70 % of the earth’s surface is water-covered, available and usable fresh water accounts for only 0,5 % of water on earth(26); whereas mountains are real water towers and important freshwater reservoirs in Europe, the Alps alone providing 40 % of Europe’s fresh water(27);

    C.  whereas groundwater supplies two thirds of the EU’s drinking water and supports many ecosystems(28); whereas the services provided by freshwater ecosystems are worth over EUR 11 trillion in Europe, and provide considerable health and recreational benefits, such as from angling(29);

    D.  whereas water stress is already occurring in Europe, affecting approximately 20 % of Europe’s territory and 30 % of the population on average every year, figures that are likely to increase in the future on account of climate change(30), despite the fact that total water abstraction at the EU-27 level appeared to decrease by 15 % between 2000 and 2019; whereas the increase in the number and recurrence of extreme weather events such as droughts and floods, and the fact that they are expected to become yet more frequent in the near future, poses a risk to human life and the EU’s food sovereignty and could lead to regions in Europe becoming uninhabitable;

    E.  whereas 78 % of Europeans consider that the EU should propose additional measures to address water-related issues in Europe and 21 % of Europeans consider pollution to be the main threat linked to water in their country(31);

    F.  whereas the human right to water and sanitation was recognised as a human right in a resolution adopted by the UN General Assembly on 28 July 2010;

    G.  whereas the European Citizens’ Initiative Right2Water was the first ever to gather the required number of signatories, calling for the EU to ensure the right to water for all;

    H.  whereas the provisions of Article 14 TFEU and Protocol No 26 thereto on Services of General Interest are key elements to be prominently taken into account in all aspects of the design and implementation of the European water resilience strategy (EWRS), thus safeguarding the status of Europe’s water services as essential public services, and ensuring accessibility, equity, affordability and the maintenance of high quality standards;

    I.  whereas the Member States should follow up on the recommendations of the Commission report of November 2023(32) in order to improve water balances as the knowledge basis for making decisions about water allocation;

    J.  whereas substantive corporate value may be at risk owing to worsening water insecurity, with a decrease in the capacity of production or its complete halt as a consequence; whereas assets in water-stressed regions could become stranded, temporarily or permanently, if assumptions made about water availability and access prove inaccurate, if regulatory responses are unanticipated or if risk mitigation and stewardship plans are not put in place(33);

    K.  whereas the deadline set by the Water Framework Directive (WFD) for European rivers, lakes, transitional waters, coastal waters and groundwaters to achieve ‘good’ status was 2015, with a possible postponement to 2027 under certain conditions; whereas the objective of achieving good chemical status for all EU water bodies by 2027 remains far from being achieved, primarily due to substances such as mercury, brominated flame retardants and polycyclic aromatic hydrocarbons(34);

    L.  whereas the 2025 report on the implementation of the WFD shows that delays in meeting the WFD’s targets are not due to a deficiency in the legislation but to a lack of funding, slow implementation and insufficient integration of environmental objectives into sectoral policies; whereas analysis has shown that the Member States are not meeting the annual investment needs, which are estimated to be EUR 77 billion, with a financing gap currently estimated at around EUR 25 billion a year; whereas the report also shows the clear need for the Member States to increase their level of ambition and accelerate action to reduce the compliance gap as much as possible before 2027, to increase investment and ensure adequate financing, including via EU funds, to achieve the objectives of their programmes of measures, as well as to put in place additional measures to reduce current persistent environmental challenges to and improve transboundary cooperation;

    M.  whereas the water legislation has been evaluated as fit for purpose; whereas it establishes a framework for the protection of inland surface waters, transitional waters, coastal waters and groundwater; whereas, at the same time, it allows for less stringent environmental objectives to be achieved if socio-economic needs served by such human activity cannot be achieved by other means and it allows for a failure to achieve the objectives for water bodies if the reason for the failure is overriding public interest; whereas the legislation is proportionate and mandates the authorities of the Member States, in line with the principle of subsidiarity, to decide on the overriding public interest; whereas in some cases this may be the protection of the environment and in others a socio-economic activity;

    N.  whereas industry accounts for approximately 40 % of total water abstraction in Europe; whereas the largest categories of the annual water abstraction in the EU-27, according to the statistical classification of economic activities in the European Community (NACE), are abstraction for cooling in electricity generation (34 %), followed by abstraction for agriculture (29 %), public water supply (21 %) and manufacturing (15 %)(35); whereas data on water abstraction and use in the EU is historical and poor(36);

    O.  whereas electricity production is the largest water-abstracting sector, but most of the water is returned to the environment after cooling or turbine propulsion; whereas overall, agriculture is the highest net water-consuming sector at the EU level, as most of the water is consumed by the crop or evaporates; whereas other uses, such as industry and water utilities, abstract and consume comparatively less water, but they can represent significant pressures at a local level, especially on groundwater(37);

    P.  whereas all industrial activity requires water to produce its end products or to support production activities; whereas businesses depend on water for their daily operations, and as water scarcity increases, it can disrupt operations, raise costs and create regulatory and reputational risks;

    Q.  whereas the energy sector relies heavily on water resources; whereas this dependency poses a serious risk as water scarcity can impact energy production processes and supply security, especially where water is used as feedstock or for cooling; whereas the transition to renewable energy, particularly wind and solar energy, offers sustainable and water-efficient decarbonisation pathways and the opportunity to halt or reverse the trend of increasing water consumption;

    R.  whereas water is an essential resource for agriculture in the production of high-quality food, feed and renewable raw materials; whereas agriculture depends on water availability and irrigation helps to shield farmers from irregular rainfall and to increase the viability, yield and quality of the crops, but is a significant drain on water resources; whereas in view of climate change, changing weather patterns and increased frequency of floods and droughts, the importance of water as a resource for the production of high-quality agricultural products and of the need for water to be used efficiently will therefore be fundamental to the security of food supply and to the solutions to address water scarcity; whereas reducing pressure on surface water and groundwater from agriculture must go hand in hand with investment aimed at the use of reclaimed water and innovative desalination technologies, thereby achieving a better water balance as well as promoting clean alternative energies such as green hydrogen;

    S.  whereas global population growth requires increased food production, and the EU must guarantee food sovereignty, as laid down in Article 39 TFEU;

    T.  whereas reliable data on water accounting, that is, the systematic study of the current status and trends in water supply, demand, accessibility and use in domains that have been specified(38), is crucial for an assessment of the current situation in the EU and for European competitiveness;

    U.  whereas the potential of wastewater as an alternative water supply is underestimated, given that 60-70 % of the potential value of wastewater across the EU is currently unexploited(39) and less than 3 % of treated wastewater is reused in the EU(40); whereas there is significant potential for circular approaches to water in households, as only a small amount of the water in households is used for drinking and eating and therefore requires the highest quality standards;

    V.  whereas a very large quantity of water is lost due to obsolete or ageing water networks and the lack of necessary maintenance; whereas investment in the maintenance, improvement and development of resilient innovative irrigation infrastructures is essential for reducing and improving the efficiency of water consumption in agriculture; whereas such improvements in efficiency enable the water saved to be used for other purposes or enable the natural flow rates of watercourses to be maintained;

    W.  whereas clean and sufficient water is an essential element in implementing and achieving a real sustainable circular economy in the EU;

    X.  whereas water leakage is an underestimated global issue, which significantly exacerbates water scarcity, with an average of 23 % of treated water lost during distribution in the EU due to leaky pipes, outdated treatment facilities and insufficient reservoirs(41); whereas the revised Drinking Water Directive included measures to reduce water leakages, as well as risk assessment and management of the catchment areas for drinking water abstraction;

    Y.  whereas in 2021, 91 % of Europe’s groundwater bodies were reported as having achieved ‘good quantitative status’, while 77 % were reported as having ‘good chemical status’(42);

    Z.  whereas in 2021, only 37 % of Europe’s surface water bodies were reported as being in ‘good’ or ‘high’ ecological status, while 29 % achieved ‘good chemical status’(43);

    AA.  whereas the European Environment Agency emphasises that the proportion of surface waters failing to achieve good ecological status is uneven across Europe, and that these are more prevalent in parts of central and western Europe, and stresses that differences in water status between the Member States may be caused by different pressures, but that those differences may also result from varying approaches to monitoring and assessment(44);

    AB.  whereas the quality of surface waters across the continent reflects continuing and combined pressures, in particular diffuse pollution and the degradation of their natural flow and physical features; whereas pollution by nutrients and persistent priority substances, as well as by substances newly emerging as pollutants, continues; whereas groundwaters are affected by diffuse pollution and also suffer from intensive abstraction(45);

    AC.  whereas groundwater supplies 65 % of water for drinking and 25 % of water for agricultural irrigation in the EU(46); whereas it is a finite resource that needs to be protected from pollution and over-exploitation(47);

    AD.  whereas monitoring data from the European Environment Agency indicates widespread pollution by per- and polyfluoralkyl substances (PFAS), commonly referred to as ‘forever chemicals’, in European waters, posing significant risks to aquatic ecosystems and human health; whereas short-chain PFAS trifluoroacetic acid (TFA) has been detected in drinking water all over Europe; whereas PFAS persist in the environment, bioaccumulate in living organisms and cause adverse (eco)toxicological effects; whereas from a group of 6 000 to 10 000 individual substances, only a few have been extensively studied and their impact on human health and environment is known; whereas 99 % of PFAS remain undetected in the environment as a result of limits in monitoring;

    AE.  whereas the lack of EU-wide quality standards for PFAS in groundwater and insufficient monitoring of less-studied PFAS compounds exacerbate the challenge of achieving good chemical status for EU waters in line with the WFD and pose a substantial technical and financial burden on health systems and on water service providers while jeopardising applications of water and sewage sludge reuse;

    AF.  whereas hazardous chemicals, including heavy metals and other pollutants, released into water bodies by industrial activities, significantly impact water quality and aquatic ecosystems(48);

    AG.  whereas pharmaceutical substances are increasingly identified in surface water and groundwater; whereas pollution caused by pharmaceutical residues necessitates advanced water treatment technologies, including membrane filtration, activated carbon treatment, advanced oxidation processes and other innovative purification techniques;

    AH.  whereas Directive 2010/75/EU(49) mandates that the potential aggravation of the impact of industrial discharges on the state of water bodies due to variations of water flow dynamics should be explicitly taken into account in the granting and reviewing of permits; whereas the best available techniques will newly incorporate notions of environmental performance levels related to water and permits, which translate the use of these techniques into environmental performance limit values; whereas this is a welcome change with a potential improvement to the industry’s resilience, as EU installations may already face a lower production capacity seasonally due to water scarcity;

    AI.  whereas urban wastewater is one of the main sources of water pollution, if not properly collected and treated; whereas the objectives of the Urban Wastewater Treatment Directive should not be lowered, and its scope should be extended to other sectors and substances that contribute to water pollution;

    AJ.  whereas nutrient pollution in EU water bodies leads to eutrophication, loss of biodiversity, and degradation of aquatic ecosystems(50); whereas pesticide run-off contaminates surface water and groundwater, threatening water quality and human health;

    AK.  whereas research indicates that exposure in Europe to the synthetic chemical bisphenol A (BPA), which is used in products ranging from plastic and metal food containers to reusable water bottles, is well above acceptable health safety levels(51);

    AL.  whereas soil and nutrient management lies at the basis of improving water quality and availability; whereas the EWRS should focus on improving nutrient management, with the aim of closing nutrient loops to reduce nutrient emissions to waterways; whereas the safe use of sewage sludge in agriculture will also reduce the EU’s very high dependency on the import of phosphorus mineral fertiliser, for example, from Russia; whereas the safe use of sludge should therefore also be considered as contributing to European resilience and strategic autonomy;

    AM.  whereas climate change represents a major threat to water resources and aquatic ecosystems; whereas many impacts of climate change are felt through water, such as more intense and frequent droughts, more extreme flooding and more erratic seasonal rainfall; whereas floods and water scarcity compromise food and water security, and the health of the general population, ultimately affecting social cohesion, economic prosperity and stability, as well as jeopardising the long-term availability of this valuable resource;

    AN.  whereas the European climate risk assessment recognised that Europe’s policies and adaptation actions are not keeping pace with the rapidly growing risks that threaten ecosystems, infrastructure, food and water supply and people’s health, as well as the economy and finance(52);

    AO.  whereas assessments by the Intergovernmental Panel on Climate Change show that the sea level rise due to climate change is leading to an increase in the salinity of soils and freshwaters, compromising ecosystem health and water quality, as well as affecting 80 million Europeans living in low elevation coastal zones and flood plains; whereas freshwater and marine ecosystems are interconnected as riverine pollution, disruption to sediment flows and water shortages all have a very strong impact on the health of marine ecosystems, particularly the coastal ones, as well as on the viability of social and economic activities that depend on them, such as transport, fisheries, agriculture, aquaculture and tourism;

    AP.  whereas prolonged drought, extreme heat and large-scale flooding events, caused by changing weather patterns, will intensify and become more frequent throughout the continent, damaging ecosystems and human health and leading to major disruption to economic activities and decreasing the overall quantity and quality of available water; whereas preserving water resources and the natural functions of rivers, while supplying sufficient water of good quality, is becoming a major challenge that will require increased climate change mitigation and adaptation efforts, effective management and innovative measures to increase water availability; whereas managing water scarcity and flood risks affordably and sustainably will increasingly become important across the EU;

    AQ.  whereas in 2022, Europe experienced its hottest summer and the second warmest year on record, leading to drought impacting over 15 % of EU territory; whereas the average annual economic loss caused by droughts in the EU between1981 and 2010 was estimated at around EUR 9 billion per year; whereas with no adaptation measures, it is estimated that annual drought losses in Europe and the UK could increase to EUR 45 billion per year up to 2100 with warming of 3°C(53); whereas in the period of 1998-2020, floods comprised 43 % of all disaster events in Europe; whereas climate change impacts and socio-economic developments are leading to more frequent flooding, affecting an increasing number of people and causing increasing damage; whereas 12 % of Europe’s population lives in floodplains(54);

    AR.  whereas the cost of inaction in addressing water-related challenges is extremely high, given that 90 % of disasters are related to water(55); whereas without policy action, the cost of economic losses from coastal floods alone could exceed EUR 1 trillion per year by the end of the century in the EU(56) and the economic cost of droughts in Europe could exceed EUR 65 billion a year by 2100(57);

    AS.  whereas significant differences exist between the Member States in water availability, management strategies and usage patterns, and vulnerability to climate change impacts can vary considerably; whereas a tailored approach is required to enhance water resilience and ensure sustainable water management;

    AT.  whereas droughts constitute one of the chief catastrophic consequences of climate change; whereas around 23 % of the EU’s territory is moderately susceptible to desertification and 8 % is highly susceptible to it; whereas Hungary, Bulgaria, Spain and Italy are among the countries most affected, and 74 % of Spain’s surface area is at risk of desertification; whereas the EWRS should look beyond prolonged droughts, but rather address the reality that the semi-arid line is moving north, resulting in increasing areas in the EU that will face chronic long-term unavailability of sufficient freshwater resources;

    AU.  whereas policies related to desertification, water consumption and climate change are closely interconnected; whereas as part of the United Nations Convention to Combat Desertification, the EU reaffirmed in 2015 and later re-confirmed in 2024(58) its commitment to achieving land degradation neutrality by 2030, which, according to the European Court of Auditors special report on desertification, is unlikely to be achieved;

    AV.  whereas water infrastructure can help maintain a constant and predictable flow and supply of water; whereas in 2022, the annual average river discharge across Europe was the second lowest since records began in 1991(59);

    AW.  whereas downstream areas are particularly dependent on upstream water management and abstraction; whereas the Member States should refrain from implementing measures that significantly increase flood risks upstream or downstream of other countries in the same river basin, in accordance with the WFD;

    AX.  whereas nature-based solutions are pertinent interventions that, when tailored to specific ecosystems and needs, can increase resilience in the water cycle and provide multiple benefits in terms of biodiversity protection, carbon sequestration, improved water quality, nutrient retention, supply of drinking water, wildfire prevention and flood risk mitigation; whereas nature-based solutions can enhance the effectiveness and the operable life of water infrastructure, therefore ensuring, in many cases, complementarity of both solutions;

    AY.  whereas natural water retention measures are nature-based solutions that aim to store water in natural, agricultural, forested and urban landscapes;

    AZ.  whereas water is not a commercial product like any other but, rather, a heritage which must be protected, defended and treated as such; whereas, under Directive (EU) 2024/1203 on the protection of the environment through criminal law(60), abstraction of surface water or groundwater within the meaning of the WFD constitutes a criminal offence where such conduct is unlawful and intentional, and causes, or is likely to cause, substantial damage to the ecological status or the ecological potential of surface water bodies or to the quantitative status of groundwater bodies;

    BA.  whereas soil biodiversity and soil organic carbon affect water retention capacity; whereas soil erosion, compaction and certain soil management practices that cause soil degradation lead to a steady decrease in the water retention capacity of soil, which as a consequence exacerbates drought and flood events with a direct negative impact on farming; whereas healthy soil is therefore one of the drivers of water resilience, which itself should be approached and managed at river basin level; whereas better land management is key to preventing disasters;

    BB.  whereas the current multiannual financial framework (MFF) includes an ambitious but non-binding target of dedicating at least 7,5 % of annual EU spending to the biodiversity objectives in 2024 and 10 % in both 2026 and 2027; whereas the new financial framework should incorporate a water perspective with a view to allocating sufficient resources to the future EWRS in order to ensure resilient water ecosystems and infrastructure, and security of water supply, and to facilitate investments in innovative solutions;

    BC.  whereas cohesion funding has played a crucial role in improving water and sanitation services across the Member States; whereas continued support is required to ensure their long-term resilience and compliance with increasingly stringent quality standards;

    BD.  whereas pricing policies can improve the efficiency of water use; whereas such policies are a national competence and account for the regional differences in water availability and the source of water supply; whereas pricing can play a significant role in prompting households and other economic sectors to optimise consumption, as well as in ensuring that water users effectively participate in recovering the costs of water services; whereas pricing policies should also consider affordability for households and small businesses;

    BE.  whereas digitalisation and innovation can effectively assist the Member States, regional bodies and the Commission in collecting data on and monitoring water management; whereas the EU is at the forefront of new technological developments in the water sector, accounting for 40 % of all international patent families in this sector between 1992 and 2021(61), a position that needs to be fostered and nurtured, and the potential of the internal market fully exploited; whereas hurdles for the introduction and scaling-up of new water technologies need to be examined and a just European level playing field guaranteed; whereas continued support for research in water technology innovation is needed to secure and to create jobs and boost European competitiveness;

    BF.  whereas innovation is a crucial tool to help the water sector meet the challenges of the United Nation’s SDGs, adapt to climate change and become more water-efficient;

    BG.  whereas deployment of monitoring and modelling technologies is still lagging behind in many Member States, and the digitalisation of the sector is too slow; whereas provisions on the river basin management plans in the WFD do not explicitly include concrete measures to digitise the water sector; whereas common shortcomings for the current policies harnessing the potential digital solutions are related to the lack of technology guidance, monitoring standards, policy integration, standardisation and public involvement;

    BH.  whereas the water sector is vulnerable to various threats, including physical attacks, cyberattacks and contamination with harmful agents; whereas such incidents could result in widespread illness, casualties and service disruptions, significantly impacting public health, the environment and economic stability; whereas the digitalisation of water management might introduce further security risks in a context of increasing hostile attacks on critical infrastructure; whereas the implementation of the NIS2 Directive and Critical Entities Resilience Directive can contribute to mitigating security risks to vital (drinking) water systems and (drinking) water infrastructure, arising from geopolitical tensions;

    BI.  whereas advances in sensor technology, computing, artificial intelligence (AI) and big data management can help monitor water quantity and quality and inform the operational decisions of the policymakers and water management companies; whereas innovations in nature-based systems to manage water are available and can contribute to resilient water management;

    BJ.  whereas water is a vital component in the life cycle of AI, both in the operation of data centres and the manufacture of hardware; whereas the rapid expansion of AI could result in an exponential increase in water demand; whereas that dependency on an increasingly scarce resource poses significant challenges in terms of sustainability; whereas strategic technologies, such as semiconductors, hydrogen, electric vehicle batteries and data centres, play a key role in achieving a competitive and autonomous EU;

    BK.  whereas chiller and cooling tower systems, based on innovative cooling technologies such as evaporative and closed-loop cooling, are already available and can contribute to reducing water consumption in industrial, heating, ventilation and air conditioning systems applications;

    BL.  whereas research must be promoted with a view to producing alternative active ingredients to combat pests, to ensure greater plant health and reduce the use of inputs and phytosanitary products;

    BM.  whereas water resilience is crucial in education and teaching, and in raising awareness and giving information about the functioning of the water cycle;

    BN.  whereas limited access to water and related infrastructure has a negative impact, especially on women, as it undermines the realisation of other human rights, such as self-determination, economic independence and education;

    BO.  whereas 60 % of European river basin districts are transnational, which makes effective transboundary cooperation crucial; whereas 20 European countries depend on other countries for more than 10 % of their water resources, with five countries relying on more than 75 % of their resources coming from abroad via rivers(62); whereas this cooperation should be strengthened to account for current and future climate challenges such as droughts and floods;

    BP.  whereas United Nations Secretary-General António Guterres appointed a Special Envoy on Water, aiming to enhance international cooperation and synergies among international water processes;

    BQ.  whereas clean water access and sustainable and resilient sanitation infrastructure are key components of the One Health approach, recognising the interconnection between the health of humans and water pollution;

    BR.  whereas water cooperation across borders and sectors generates many benefits, including enhancing food security, sustaining healthy livelihoods and ecosystems, helping address resilience to climate change, contributing to disaster risk reduction, providing renewable energy, supporting cities and industry, and fostering regional integration and peace;

    BS.  whereas geopolitical developments demonstrate that the EU should be ready to withstand the challenges that go beyond the environmental sphere; whereas non-environmental threats, such as recent accidents related to the damaged cable in the Baltic Sea, send the EU a strong message that strengthening transboundary cooperation is key in addressing both the environmental and security-related objectives;

    BT.  whereas about 41 000 kilometres of inland waterways flow through 25 of the Member States; whereas inland waterways, which rely on the availability of water resources, perform a crucial role in optimising water supply and mitigating the impact of droughts and floods, as well as supporting the economic activities and the development of regions;

    BU.  whereas the increasing water scarcity, inequalities in access to water, and external shocks to the water sector have heightened interdependencies, increasing competition for water and leading to complex economic repercussions;

    General remarks

    1.  Welcomes and supports President von der Leyen’s announcement in the political guidelines for the next European Commission (2024-2029) on putting forward a European Water Resilience Strategy (EWRS) addressing water efficiency, scarcity, pollution and water-related risks, as well as the recognition that water is an indispensable resource that is increasingly under stress from climate change and increasing demands;

    2.  Believes that while implementing legislation, economic competitiveness should be taken into account in line with the Competitiveness Compass; calls for the implementation of EU environmental legislation in order to build a resilient and competitive Europe, mitigate and adapt to climate change, halt biodiversity loss, prevent pollution, ensure food security, limit resource use and waste, and strive towards efficient use of resources, including water, while taking into account the precautionary principle, the control-at-source principle and the polluter-pays principle; highlights the fact that water availability impacts the quantity, quality, variety and seasonal availability of foods that can be produced;

    3.  Calls for the EU to integrate its commitments to the COP29 Baku Dialogue on Water for Climate Action and the UN 2023 Water Conference into the international dimension of the strategy;

    4.  Stresses the urgent need to enhance water resilience and management to ensure sustainable freshwater supplies for people, the economy and the environment; emphasises that the EWRS should be developed in coordination with the European Oceans Pact, ensuring a cohesive and integrated approach to managing freshwater and ocean resources, addressing interconnected challenges, enhancing competitiveness and promoting sustainable water management across inland and marine environments, while ensuring a holistic ‘source-to-sea’ approach;

    5.  Insists on the need for a comprehensive and holistic EWRS that integrates water quality, quantity, security, infrastructure, technology and management aspects and includes the restoration of the water cycle as a key element, as it underpins economic activities, ensures resource availability and contributes to climate regulation;

    6.  Stresses the importance of water supply, in particular drinking water, as well as water security of supply; points out that all environmental restoration projects should take into account the water security aspects, prioritising solutions that not only provide environmental benefits, but also guarantee the supply and efficient management of water; emphasises, furthermore, that ecological restoration measures should be carried out in synergy with the development of the EU’s renewable energy potential and not impact the overall energy resilience;

    7.  Recommends that lakes and other freshwater-dependent habitats be included in the strategy, alongside rivers, transitional waters and groundwater, as essential components of the EU’s water resilience efforts;

    8.  Stresses the urgent need to improve crisis-warning systems with regard to heavy water incidents, as well as to improve preventive measures;

    9.  Calls on the Commission to present a European climate adaptation plan, including concrete legislative proposals and actions, particularly regarding infrastructure resilience, water management and nature-based solutions, while prioritising the protection of vulnerable communities, to make the EU more resilient and to lead by example;

    10.  Reiterates that access to clean and safe drinking water and sanitation is a human right; emphasises that this right must be unequivocally ensured, with everyone having access to affordable and good quality water services, including the inhabitants of islands and outermost regions;

    11.  Stresses that no one, whether in public places or private establishments, should be denied access to water supplied from a distribution network intended for human consumption, where available;

    12.  Notes that industrial activities and agricultural production require water to produce their end products or to support production activities, with the amount of water used varying depending on the type of activity; highlights the fact that ensuring Europe’s competitiveness and strategic autonomy requires a water-smart society where technology and data enhance a circular economy, fostering sustainable and water-efficient practices; calls on all relevant actors to accelerate the transition towards water-efficient, circular industry and agriculture by promoting and investing in innovative solutions, including digital tools and technologies, resource recovery, water reuse, renewable energy production, infrastructure, nature-based solutions and inclusive governance mechanisms;

    13.  Urges the Commission to integrate and mainstream the water dimension into internal and external EU policies through a cross-sectoral approach in order to ensure that water resilience, sustainability and security is woven into the fabric of European policies; calls on the Commission, in particular, to carry out a water-related assessment of any regulatory measure, including related to energy, as part of the socio-economic and environmental impact assessment; emphasises that assessing how each EU policy, and EU-funded projects and infrastructure, can impact water resources in terms of quantity, quality and accessibility would ensure that water resilience is a cornerstone of policy formulation and implementation, thus shifting the paradigm from treating water as an infinite resource to recognising its intrinsic value for humanity and for the EU’s ecological and socio-economic landscape and its competitiveness;

    Water efficiency

    14.  Stresses that efficient water use is essential for preserving the EU’s water resources and that water efficiency should be a key objective of the EU; calls, in this regard, for a consequential reduction in water demand, including by addressing excessive leakage levels, investing in research and innovative solutions, modernising industrial and production processes, upgrading water infrastructure, managing water resources and peak demands sustainably, prioritising uses and ensuring that higher water efficiency results in a reduction in overall freshwater consumption as well as in an increase in water availability in water-stressed areas at the local and regional levels; believes that areas affected by prolonged drought and desertification should be given priority;

    15.  Calls for a legislative framework setting sectoral water efficiency and water abstraction targets at basin level, based on up-to-date assessments of water availability and climate risks, including a water valuation approach that accounts for ecosystem services and long-term sustainability, and covering all water uses, including industry, energy, agriculture, public institutions and households; underlines the fact that these targets should be ambitious yet adaptable, taking into account the specific circumstances and progress already achieved by each Member State to ensure continued efforts towards efficiency gains across all regions; stresses the importance of efficient and uniform data collection practices across the Member States and all sectors, including through the use of innovative technologies, as well as real-time data collection points for more transparency on water consumption; emphasises the need to carry out an appropriate assessment of the environmental and socio-economic impacts of water use; stresses that the strategic importance of food production must not be compromised; emphasises that science, research and technology are important for water efficiency and water use as well as for the circular economy in this regard; calls for the creation and promotion of new smart and high-performance irrigation systems, rainwater retention and water from reuse, as well as water-efficient irrigation systems;

    16.  Reiterates the need to develop a common EU methodology for setting water efficiency and water abstraction targets to ensure the sustainable use of available renewable water resources within an integrated water resources management framework which gives due consideration to linkages beyond the water sector through the water-energy-food-ecosystems nexus, thus enabling decision-makers and economic actors to plan the necessary investment to ensure water supply security in an increasingly sustainable manner, while giving due consideration to the characteristics of the water bodies concerned;

    17.  Calls for close collaboration on integrated energy and water resource planning and related technologies across all sectors at national, regional and local levels, including between all stakeholders, in order to establish mechanisms for ensuring coherence across water and energy policies;

    18.  Calls on the Commission to put forward a comprehensive policy on sustainable water management for industry based on reducing, recovering, reusing and recycling, including a focus on the use of water-efficient and circular technologies, water recycling, pollutant reduction strategies and the promotion of closed-loop systems;

    19.  Recalls that the growing threat of water scarcity is jeopardising industries and projects that are key to Europe’s competitiveness drive, including semiconductors, data centres, renewable hydrogen and electric vehicle battery production; notes that these industries will increasingly face pressure to reduce their environmental impact and improve water resource efficiency, including both direct and indirect water usage; calls on the Member States to support water-intensive industries in setting up water-efficiency plans aimed at saving, reusing and recycling water, preventing water pollution and implementing water-efficient technologies; calls on the Commission to incorporate comprehensive water management strategies into relevant EU industrial policies and sector-specific transition pathways, with a particular focus on strategic water-intensive sectors;

    20.  Stresses that knowledge, data, research and technology are key for efficient water use; calls for adequate financial and technical support to be given to the Member States to implement efficient water management measures, including by means of innovative and modern technologies;

    21.  Welcomes the recommendations of the final report of the Strategic Dialogue on the future of EU agriculture underlining that sustainable farming practices and new business models need to be scaled up to promote more efficient use of natural resources, especially water;

    22.  Calls for the transition to a more sustainable and competitive farming model, assisted by the implementation of sustainable practices and innovative solutions that promote biodiversity, reduce chemical inputs and enable water resources to be managed efficiently, including nature-based solutions, regenerative management, smart precision irrigation technologies, digital monitoring systems, advanced treatment methods and smart water distribution networks, optimising consumption and preventing water resource depletion, and that help ensure continued productivity while enabling agriculture to reduce pollution, use pesticides and fertilisers efficiently, improve the hydrological cycle, enhance groundwater recharge and adapt to lower water use; considers that technological solutions can also include measures that can increase water absorption, infiltration and retention in agricultural systems, which are important amid increasing occurrences of both drought and heavy rains;

    23.  Points out that innovative irrigation solutions and practices can enhance water efficiency in agriculture, gaining an economic advantage while also reducing environmental burdens; notes that farmers generally lack sufficient means and incentives to know about water use by crops, actual irrigation applications, the yield responses of crops to different water management practices, and thus current on-farm water-efficiency levels; calls on the Commission and the Member States to incentivise the uptake and support the maintenance of innovative irrigation solutions such as drip irrigation to allow for an active management of water levels and efficient use of water resources, as well as to promote continuous knowledge exchange, so that all relevant stakeholders can share greater responsibility across the entire water supply chain;

    24.  Recalls that the use of nutrients such as nitrate and phosphate is essential for food production, as this activity would not be possible without their use; recommends better consideration of the nutrient cycle in agricultural production and the exploitation of the value in urban wastewater; calls for more research into the effective use of nutrients and the development of nutrient recovery technologies, in order to decrease the Union’s dependence on imported raw materials; recognises the high potential for nutrient recovery from water and calls on the Member States to support the agricultural sector to optimise their nutrient consumption including by using resources (nitrate and phosphorus) recovered from wastewater treatment plants; calls on the Commission to propose an integrated nutrient management action plan to effectively address loss of valuable agricultural inputs, recycling of nutrients, nutrient pollution and inefficiencies in the nutrient cycle; calls for the proper and safe recovery of phosphorus from organic sources and for incentivising investments in its recovery and circular nutrient management in accordance with the Commission’s JRC publication(63);

    25.  Stresses that the current Nitrates Directive is due for revision, as outdated provisions promote the use of artificial fertilisers rather than organic manure; calls for an urgent review of the Nitrates Directive before the end of this year, and its revision to promote circular nutrient management;

    26.  Emphasises, in line with the final report of the Strategic Dialogue on the future of EU agriculture, the need to support the transition to regionally adapted crop and seed varieties and the switch to different crops, with reduced water requirements and greater drought resistance, as well as the need to support the adoption of appropriate soil management practices; considers the need for stronger support for scientific research and technological development related to the breeding of new species, to enable the production and supply of foodstuffs to be diversified and their quality enhanced, while raising the level of protection for human health and the environment; notes the potential of plant varieties that are more resistant to water stress and pests and could play a role in reducing water use and could reduce the environmental footprint of crops;

    27.  Calls for financial and technical support for farmers and rural communities, particularly in water-stressed areas, to help them adopt sustainable land management practices that improve soil and water quality, contribute to biodiversity and mitigate climate change; emphasises the need for special attention to be given to regions that are particularly vulnerable to soil degradation and water scarcity;

    28.  Acknowledges the significant efforts made by farmers to enhance water quality and emphasises the need for an appropriate timeframe to allow the effects of these measures to be accurately assessed;

    29.  Points to the success of the agricultural European Innovation Partnership EIP‑AGRI and calls for the continuation of knowledge exchange, expertise and peer-to-peer learning via the EU’s Common Agricultural Policy (CAP) Network;

    30.  Notes the links between carbon sinking and water availability, and calls for coherence between the water resilience strategy and carbon farming schemes;

    31.  Reiterates that the Water Reuse Regulation aims at reducing the pressure on water bodies by setting out provisions on reusing water after appropriate treatment extends its life cycle, thereby preserving water resources; emphasises, however, that regulatory, financial and technological barriers, including the economic competitiveness of reclaimed wastewater, risk management planning and the sharing of responsibilities, contribute to the slow uptake of reuse of reclaimed water for agriculture; calls, therefore, on the Commission and the Member States to adopt supportive policies, at both the EU and the local level, that incentivise water reuse practices, taking into account the importance of adapting wastewater treatment and quality requirements to the intended water use; notes that treated wastewater also finds valuable applications in various industrial processes and urban contexts, contributing to reducing the pressure on freshwater resources and the conservation of drinking water; calls therefore on the Commission to assess a possible extension of the scope of the Water Reuse Regulation in order to establish, at EU level, minimum water quality standards for safe water reuse for industrial and urban purposes;

    32.  Calls on the Commission and the Member States to specify systems of regulatory and financial incentives for the reuse of treated wastewater in water-intensive sectors and to provide specific funding for the construction of infrastructure connecting wastewater treatment plants and refined water distribution networks; urges a streamlined approach in EU legislation to remove administrative barriers and promote safe and efficient water recycling across the Member States; calls on the Member States to set up national water reuse and saving plans to incentivise cross-sectoral cooperation in water management;

    33.  Reiterates that reused water could alleviate abstraction from rivers, lakes and groundwater for irrigated agriculture; underlines the fact that reused water can contribute to maintaining base flows and minimum water levels during dry periods;

    34.  Highlights the potential of the building sector to save water, for example, with the help of smart sub-metering systems, efficient greywater systems, reuse of domestic wastewater or rainwater harvesting; stresses that the energy performance of buildings can be enhanced by water efficiency, reducing greenhouse gas emissions; calls on the Member States and local authorities to incentivise water-saving features in new buildings; stresses, in this regard, that water-efficient practices should be factored into urban planning; highlights the fact that harvesting rain water as well as using and reusing water efficiently can improve climate adaptation in cities;

    35.  Calls for the transition, in industry and in the energy and digital sectors, to optimised cooling efficiency and alternative cooling methods that are less water-dependent, in order to ensure significant water savings in these sectors;

    36.  Points out that, while households represent 10 % of the overall water consumption in the EU, action on improving domestic water efficiency is also necessary; notes that water-saving technological solutions are readily available and can reduce water consumption in households without compromising comfort or requiring high investment; calls on the Member States to support consumers in transitioning towards such technologies and to strengthen consumer awareness of water consumption and potential efficiency gains by anchoring domestic water efficiency in water, building and consumer policies across the EU;

    37.  Notes that the leakage rates from pipes are high in some Member States, which increases the total share of domestic water consumption; welcomes the provisions of the new Drinking Water Directive on leakage rates and the ongoing work of the Commission to evaluate those rates and set threshold values that will trigger action in the Member States concerned; calls on the Member States to urgently tackle leakage in water supply networks and to fully implement the monitoring and reporting requirements of the Drinking Water Directive, so that the Commission can set a threshold value for leakage by January 2028; emphasises the need for sustainable urban irrigation networks to be modernised, to curb leakages and reduce their water footprint; calls on the Member States to regularly inform the public about the efficiency and effectiveness of their water supplies;

    38.  Points out that public sector organisations provide significant untapped potential for saving water by virtue of their size or their nature as public organisations; believes that the public sector should act as a role model for other sectors;

    39.  Calls on the Commission and the Member States to promote easily accessible and free information, training, advisory programmes and information campaigns aimed at raising public awareness of sustainable water resource management;

    40.  Recommends that water-efficiency aspects, such as reductions in water loss and reuse of water, be integrated in the upcoming revision of the public procurement framework;

    Water pollution

    41.  Underlines the fact that the existing EU water policy framework is designed to address the effective management of water resources and the protection and restoration of freshwater and marine ecosystems, but that its poor implementation and enforcement, insufficient funding and lack of proper cost-benefit analyses of the implementation measures undermine its effectiveness;

    42.  Calls on the Commission and the Member States to implement and enforce the current legislation, in particular the WFD and its ‘daughter’ directives (the Groundwater Directive and the Environmental Quality Standards Directive), with a particular focus on strengthening the monitoring and reporting mechanisms to ensure that all Member States consistently implement the required water protection measures; recalls the need for sufficient funding to implement these acts;

    43.  Stresses that the chemical pollution of surface water and groundwater poses a threat to the aquatic environment, with effects such as acute and chronic toxicity in aquatic organisms, accumulation of pollutants in the ecosystem and loss of habitats and biodiversity, as well as to human health;

    44.  Calls for the establishment of comprehensive EU-wide quality standards for PFAS in groundwater and surface water; stresses that respective updates of the relevant directives are essential for safeguarding water quality and achieving good chemical status for water bodies as mandated under the WFD;

    45.  Insists that essential uses of PFAS in critical sectors, such as medical devices, pharmaceuticals and products necessary for the twin transition to a climate neutral and digital economy, are not endangered in the context of upcoming legislative and non-legislative proposals; calls on the Commission to propose to phase out forever chemicals (PFAS) – starting with consumer goods – linked to harmful effects on human health and the environment, based on scientific evidence, allowing their use where there are no safe alternatives; underlines the need to scale up investments and accelerate the research and development of equivalent and safe alternatives;

    46.  Calls on the Commission to propose updated limits on PFAS in drinking water, taking into account the latest scientific knowledge;

    47.  Emphasises the urgency of addressing, primarily at the source, and effectively monitoring pollution from pharmaceuticals, bisphenols, antimicrobial resistance genes, persistent organic pollutants and other existing and emerging pollutants, to align with the EU’s zero pollution ambition and the goal of achieving good chemical status for all water bodies;

    48.  Calls on the Commission to close the gaps with enhanced funding and the enforcement of current laws, and the integration of circular economy principles to mitigate pollution at its source and safeguard water ecosystems for future generations; underscores the fact that antibiotic-resistant bacteria and certain emerging pollutants remain insufficiently addressed, necessitating further innovation and investment; emphasises the need for all sectors to apply sustainable production processes and circular practices, proactively preventing pollutants from entering water systems;

    49.  Recalls that microplastics may enter drinking water sources in a number of ways: from surface run-off (for example, after a rain event) to wastewater effluent (both treated and untreated), combined sewer overflows, industrial effluent, degraded plastic waste and atmospheric deposition; calls on the Commission to put forward, in line with the requirements of the Drinking Water Directive, a full risk assessment of microplastics in drinking water, while continuously working on reliable and robust sampling and analytical methods in order to appropriately address the potential threat of this emerging pollutant to sources of water intended for human consumption;

    50.  Emphasises the need to improve the monitoring and regulation of plastic pollution in freshwater and marine environments, with particular attention to microplastics and single-use plastics; encourages the Commission to assess current enforcement mechanisms and consider further measures to protect water quality;

    51.  Calls on the stakeholders to develop safe water contact materials, to substitute BPA and other bisphenols and ensure compliance with Regulation (EU) 1935/2004 on materials and articles intended to come into contact with food(64) and the recently adopted provisions as regards the use of BPA and other bisphenols and bisphenol derivatives (Commission Regulation (EU) 2024/3190);

    52.  Recalls that the revised Urban Wastewater Treatment Directive, in effect since 1 January 2025, imposes new obligations regarding water purification, requiring pharmaceutical and cosmetic producers to cover at least 80 % of the costs of removing micropollutants from wastewater, with the aim of reducing harmful substances in the environment; notes the existence of differing figures and assessments regarding the impact this would have on the pharmaceutical sector and, consequently, on the availability and affordability of medicines, and therefore calls on the Commission to conduct a new and comprehensive assessment of the impact on this sector;

    53.  Calls for increased EU support for local authorities for the modernisation of wastewater treatment plants and the promotion of water reuse, to align with the EU’s zero pollution ambition, ensuring that municipal wastewater management contributes effectively to good chemical and ecological water status;

    54.  Calls for increased monitoring of pesticide residues in water bodies and enforcement of pesticide application regulations to mitigate their impact on water quality; stresses the need for increased funding to support farmers in the adoption of low-input and organic farming practices that reduce reliance on chemical pesticides and fertilisers, as well as to provide appropriate training and independent advisory services to farmers and other operators on the use, effectiveness and toxicity of pesticides, as well as best practice;

    55.  Insists on the integration of circular economy principles to reduce hazardous chemical use in industrial processes; stresses the need for additional funding to support industries in transitioning to clean technologies that minimise water pollution(65);

    56.  Recognises the role of treated sludge as a local and circular source of fertiliser, contributing to soil health, nutrient recycling and reduced dependency on synthetic fertilisers; emphasises the importance of preventing PFAS, heavy metals, microplastics and other harmful substances from entering sewer networks in order to enable the safe and sustainable use of high-quality sewage sludge in agriculture;

    57.  Calls on the Commission to include an overview of measures in an annex to the EWRS, with a timeline for achieving the objectives in question;

    Adaptation to climate change: floods, droughts, stress areas, disaster preparedness

    58.  Calls for the climate adaptation proofing of all new EU legislative and non-legislative acts in order to ensure the integration of climate adaptation into sectoral plans and policy measures affecting water and land use; highlights, in this regard, the need for increased climate ambition as part of the fight against climate change, while urging the Member States to ensure that all climate adaptation measures affecting water use contribute to long-term, improved water resilience; calls on the Commission to take fully into account the geographical and environmental conditions in the Member States, as well as the specific situation of islands, outermost regions and other areas of high vulnerability, such as areas affected by desertification, when adopting new legislative and non-legislative proposals; asks the Commission to present a roadmap for current and ongoing legislative and non-legislative policy measures, including targets and monitoring requirements affecting water and land use;

    59.  Emphasises the need for tailored climate adaptation measures for the Mediterranean region, which faces unique challenges such as prolonged droughts and saline intrusion into freshwater resources;

    60.  Stresses the specific challenges faced by island areas due to the scarcity of drinking water and calls for targeted measures to protect island water resources, including improving rainwater collection and storage infrastructure, and implementing alternative water sources, while enhancing water resource monitoring and management systems; calls, further, on the Member States to take better account of mountainous regions in national adaptation plans in order to meet the specific challenges of water management in mountainous areas;

    61.  Reiterates that climate change mitigation and adaptation solutions should not come at the cost of ecosystem degradation, and should avoid increasing the demand for water- and energy-intensive activities, and should instead prioritise energy- and water-efficient innovation and technologies as part of moving towards a more resource-efficient economy, without undermining its productivity, while ensuring equitable access to water for all; points out that, in order to be effective, climate change mitigation and adaptation solutions should be tailored to national circumstances, while enhancing competitiveness and productivity in the short and long term; points out the possibilities of synergies, in this regard, with innovative energy production such as photovoltaics and biogas, as it can also contribute to an increase in agricultural income;

    62.  Recognises the importance of reserving water for nature and the need to maintain healthy freshwater ecosystems, for the good functioning of the water cycle, for human activities and for mitigating the impacts of droughts and water scarcity; underlines, in the context of restoring freshwater ecosystems and the natural functions of rivers, the importance of removing ‘obsolete barriers’, namely artificial barriers that no longer fulfil their original purpose or are no longer needed, wherever such opportunities exist, on the basis of current knowledge and experience; calls for the establishment of specific programmes for the cleaning and conservation of river channels, ensuring minimum flow and reducing the accumulation of debris and sediment that can affect water storage and distribution capacity;

    63.  Insists that, with climate change impact becoming more persistent, flood and drought management must fully integrate the arising risks, including changing weather patterns, such as increased rain patterns leading to excess of water; is convinced that a combination of monitoring and data collection, preparedness, emergency and recovery responses taking into account the principle of ‘building back better’(66)on the one hand, and adapting societal and economic activities on the other, is essential to reduce vulnerability and increase resilience, especially in the light of the quantitative aspect of water becoming more prominent; stresses, in this regard, the need for climate-resilient nature-based solutions and infrastructure that take into account the impact of extreme climate events in their development to ensure their viability in the face of extreme climate events;

    64.  Recalls that in 2007, the WFD was supplemented by Directive 2007/60/EC on the assessment and management of flood risks, which aims to establish a framework to reduce the adverse consequences of flooding on human health, the environment, cultural heritage and economic activity; notes that making the two directives mutually compatible is achieved through risk management plans and river basin flood management plans as the components of an integrated water management system in which coordination is crucial; recalls that flood prevention is closely connected to urban green spaces, soil protection strategies and investment in drainage networks;

    65.  Stresses that preparedness for water scarcity and drought can be significantly improved in the EU, considering that no drought management plans are in place in several Member States(67); calls on the Member States and, where applicable, competent regional and local authorities, to develop drought management plans, particularly with a view to ensuring the provision of drinking water, ensuring food production and integrating digitalised monitoring, control and early warning systems in order to support effective and data-based decisions on protection, response and communication measures with clearly defined areas of responsibility; points out the need to introduce EU-level provisions as regards drought management plans, similar to the ones on flood management plans;

    66.  Insists, in view of the numerous climatic events, such as floods, droughts and cyclones, which have affected Europe, on the importance of the EU having a robust mechanism for responding to such crises, including systems for warning and providing assistance to the civilian population; points out that digital monitoring, adequate public display of relevant data and early warning systems are key to developing effective drought and flood management plans at the level of the Member States; emphasises, further, the importance of fully using the available EU tools, such as the flood forecasts of the European Flood Awareness System and the Global Flood Awareness System, and the Global Flood Monitoring tool, as part of the Copernicus Emergency Management Service;

    67.  Stresses the importance of the Union Civil Protection Mechanism (UCPM) in helping countries hit by water-related disasters such as flood and droughts; calls for increased funding to provide the UCPM with sufficient and upgraded resources in order to increase preparedness and improve capacity building;

    68.  Calls on the Commission and the Member States to enhance citizen preparedness in the event of water-related disasters or crisis; stresses the importance of information campaigns and demonstration exercises in education facilities, public administration and businesses in order to build a ‘preparedness culture’ for citizens;

    69.  Calls on the Member States to systematically renew and upgrade their water infrastructure, including drinking water and sanitation infrastructure, as well as infrastructure regulating river flows, and to invest in innovative solutions based on good practice, making water systems more resilient to climate change, ensuring stable drinking water supply, enabling the early detection of losses and reducing water leakages and waste, while optimising water transport and storage systems; highlights the fact that funding for innovative water infrastructure is insufficient compared to the investment needs across the EU; calls, in this regard, for dedicated funding, on national, regional or EU level, to ensure adequate financing for the development, maintenance and modernisation of water-resilient infrastructure, to foster innovative solutions and technologies and ensure long-term sustainability of that water infrastructure;

    70.  Regrets that, despite the threat that desertification poses to water quality and availability, soil fertility and food production, and despite the fact that 13 Member States have declared themselves to be affected by desertification in the context of the United Nations Convention to Combat Desertification, the Commission is not addressing desertification effectively and efficiently; urges the Commission, therefore, in line with the Council conclusions of 14 October 2024 on desertification, land degradation and drought, to present an integrated EU-wide action plan to combat desertification, land degradation and drought, aiming at building resilience to drought and achieving land degradation neutrality in the EU by 2030, based on a full impact assessment;

    71.  Insists that the agricultural sector be further supported in implementing new technologies to reduce the demand for water, while at the same time increasing access to water, including by supporting water retention and groundwater recharge; calls for research results, for example on seawater desalination, to be made accessible and to facilitate the deployment of innovative desalination solutions; calls on the Member States to create natural water reserves based on up-to-date assessments of climate risks to protect critical water supplies and their catchments, and taking into consideration the environmental and socio-economic impact of developing such reserves; points out that such natural water reserves would complement the WFD’s requirement for Member States to identify water bodies used for drinking water abstraction, making sure they meet the objectives set out in Article 4 WFD and in the Drinking Water Directive, and would ensure their necessary protection; notes that such natural water reserves already exist under different forms in various Member States; stresses that assistance should be given to Member States or local and regional governments to help them develop natural water reserves;

    72.  Notes the potential of retention infrastructure as an example of water generation systems created using the best available, cost-effective techniques that have the lowest environmental impact, including by means of wastewater reuse or rainwater collection, in order to reduce the risks of droughts and floods, increase water security and foster circularity, water reclamation and reuse; believes that water retention facilities may be useful tools provided that they are authorised by local or national authorities under clear conditions, including the capacity of local groundwater to sustain such activities and the need for farmers accessing the water resource to adapt their practices to more sustainable practices, in particular in terms of water needs and water quality; calls on the Commission to use its available tools, including financial support, to streamline this approach among the Member States;

    73.  Deplores the unlawful or intentional abstraction of water, which is likely to cause substantial damage to water bodies; calls for strong dissuasive measures to be applied, including through the criminal law, to protect the ecological status or the ecological potential of surface water bodies or of the quantitative status of groundwater bodies; notes that additional support for training and knowledge transfer for national enforcement capacities is needed;

    74.  Notes the important cross-cutting role of nature-based solutions in addressing the challenges of the triple planetary crisis and restoring the natural water cycle; calls on the Commission and the Member States to prioritise, taking into account the environmental and socio-economic impacts, the deployment of nature-based solutions for water resilience in their policy actions and recommendations, such as the re-wetting of wetlands and peatlands to increase ground water availability and surrounding soil moisture, the restoration and protection of floodplains, natural water retention measures, revegetation as a barrier against floods, and rainwater conservation, in order to strengthen water availability, mitigate climate change risks and support long-term resilience for communities, businesses and food production; underlines that, in addition to nature-based solutions, complementary investment in engineering solutions remains necessary to ensure successful climate adaptation and water resilience in the long term;

    Funding and pricing

    75.  Notes that nature-based solutions and natural water retention measures have the potential to restore groundwater levels and support ecological flows while reducing water-related risks from water scarcity, floods and droughts; notes that in flood management, nature-based solutions cannot usually replace existing solutions and may not be effective for the most extreme events; points out, however, that nature-based solutions can enhance the effectiveness and operable life of grey infrastructure by increasing water absorption capacity, reducing water velocity and regulating peak flows; reiterates, in this regard, that the effectiveness of nature-based solutions is context-specific and must be adapted to the local situation; emphasises in this regard that a ‘one solution that fits all’ does not exist;

    76.  Stresses the need to provide financial support for sustainable innovative methods and solutions, while having due regard to public-private partnerships;

    77.  Stresses, in the context of climate adaptation, the importance of healthy soils in ensuring water security and circularity; emphasises that the natural water retention of soils must be improved through measures to enhance soil health, minimising carbon losses, as well as actions at the level of the water body, such as the stabilisation of riverbanks, including through re-naturalisation, and the restoration of the retention capacities of aquifers;

    78.  Notes that thoroughly designed forest management measures can improve watershed health, regulate water flow and reduce drought and flood stress, given the essential role of trees and forests in water cycle regulation, through their ability to purify water, increase the availability of water resources and improve soil moisture retention; proposes that this be duly considered when the Commission, in cooperation with the Member States, develops Union disaster resilience goals and that it be considered in the development and refinement of disaster risk management and contingency planning; highlights the need, in this regard, for more research, data collection, innovation and funding to support land managers in preventing the impact of environmental stressors such as drought floods and diminishing watershed function;

    79.  Recognises that urban areas are increasingly vulnerable to water-related climate risks such as flooding, water shortages and heat stress; calls for the integration of urban water resilience planning into climate adaptation strategies, including investment in green roofs, permeable infrastructure, rainwater harvesting and storm water retention systems, as well as measures aimed at increasing green and blue spaces in urban areas, in order to mitigate extreme weather impacts and to reduce the risks to human life and property; calls further for the maintenance of, and regained access to, urban waterways in cities;

    80.  Emphasises that the EWRS should ensure adequate funding from public and private sources in order to support the modernisation, upgrading, adaptation and maintenance of resilient water infrastructure, sustainable water management, data collection, research, effective monitoring, digitalisation, upskilling, nature-based solutions, the development and the uptake of innovative water-efficient technologies, as well as to ensure environmental and socio-economic sustainability in line with the goals set by the new European Competitiveness Compass;

    81.  Calls on the Commission to create a separate and dedicated fund for water resilience within the upcoming MFF; believes that specific financial mechanisms should also be established within the European Regional Development Fund and the Cohesion Fund to support water-smart technologies and water investment; strongly believes that, in the interim, water should be prioritised in existing funding frameworks, including the Cohesion Fund; stresses that EU funding mechanisms must incorporate considerations of social equity and affordability, in particular in the context of providing water services to the population, ensuring support for Member States and citizens with greater financial constraints and specific realities, while meeting water management obligations; highlights the importance of adjusting existing funding, subsidies and financing streams related to water management and other related land uses, moving away from outdated engineering solutions to innovative ones, as well as nature-based solutions or a combination thereof;

    82.  Calls for targeted funding, via Horizon Europe and the EIP-AGRI, for field trials on the water relations of different cropping systems; calls for the recognition of the role of women in water policies and for specific funding to be identified to promote their access to agriculture;

    83.  Recalls that the lack of dedicated funding for water or binding funding targets within the current MFF limits the EU’s capacity to direct targeted investment towards essential water resilience measures, including infrastructure modernisation, innovation, climate adaptation measures and the implementation of nature-based solutions, and thus its competitive capacity, as the absence of a water balance creates an additional burden for the economy of the regions; notes that outermost and mountainous regions and islands in the EU are particularly struggling to access funding or public-private partnerships to support local and regional investment in water management and infrastructure;

    84.  Stresses the important role of the European Investment Bank (EIB) in water financing; highlights the fact that the EIB is actively investing in and supporting the water sector; stresses that the EU should collaborate with the EIB to share best practice and calls, further, on the EIB and other financial institutions to strengthen their role in the funding of innovative and resilient water infrastructure, improved sanitation and drinking water infrastructure, digitalisation, as well as to support projects aimed at flood risk reduction, erosion prevention and the revitalization of watercourses, by facilitating favourable conditions for water investment;

    85.  Urges the Commission to explore and promote innovative financing mechanisms, including payments for ecosystem services and green bonds, while ensuring regulatory clarity and safeguards to prevent market distortions; calls on the EIB and other financial institutions to prioritise low-interest loans and credits for Member States and regional and local authorities undertaking large-scale restoration projects, with specific provisions to support economically disadvantaged regions;

    86.  Highlights the importance of public-private partnerships as a source of funding for water investment; calls on the Commission to incentivise private investment in the water sector by creating a supportive regulatory framework that may include co-financing opportunities and public-private partnerships in order to drive innovation, improve infrastructure and ensure sustainable water management solutions across the Member States; underlines, nevertheless, that the involvement of private investment in the EU water sector must not undermine the status of water as a public good and a public service, and that the long-term resilience of the sector, as well as the principles of accessibility, affordability and sustainability must be ensured;

    87.  Calls on the Member States to adopt governance frameworks that clearly define the roles and responsibilities of stakeholders in planning, financing and implementing nature-based solutions; believes that these frameworks should integrate funding from diverse sources, including philanthropic contributions and private-sector partnerships, while ensuring equitable access to resources for small-scale projects, particularly managed at local or regional levels;

    88.  Urges the Commission and the Member States to address water aspects in their budgets and to improve governance within the regions in the use of EU funds;

    89.  Underlines the need to provide targeted financial and technical assistance to municipalities to facilitate compliance with water-related legislation;

    90.  Encourages the Member States to accelerate the granting of authorisations for sustainable and innovative resilient water infrastructure projects to enable their rapid implementation in the face of the urgent challenges;

    91.  Notes that the application of the cost recovery principle on water services, which provides that all water users effectively and proportionately participate financially in the recovery of the costs of water services, remains low to non-existent in several Member States; calls on the Member States and their regional authorities to implement adequate water pricing policies and apply the cost recovery principle for both environmental and resource costs in line with the WFD; calls on the Member States to take into account the long investment cycles when implementing the cost recovery principle and to ensure sufficient funding is available for needed (re)investment;

    92.  Stresses the importance of ensuring that water pricing supports long-term water security by reflecting the economic, environmental and resource costs of water use; encourages the Member States and competent regional and local authorities to ensure that water pricing is economically sustainable, socially fair and promotes efficient water use, and that it reflects the availability of water across different Member States and regions, particularly in water-stressed regions, while safeguarding affordability for households and small businesses; calls on the Member States and competent regional and local authorities to insure transparent water prices and to raise awareness of the value of water services;

    93.  Points out that competent national water authorities will play a central role in implementing new water management and conservation plans at the level of the Member States; calls, therefore, on the Members States to financially and technically increase the capacity of those competent authorities to play a more significant enabling and advisory role in sustainable and future-proof water management and storage infrastructure; believes that EU funds, such as the Just Transition Fund, should be used to further assist Member States and water agencies in implementation;

    Digitalisation, security and technological innovation

    94.  Stresses the potential and the necessity for digitalisation and AI in improving the management and monitoring of bodies of water and water infrastructure, as well as in reporting and ensuring the comparability of data reflecting different geographical flow conditions;

    95.  Calls on the Commission, the Member States and water providers to mainstream transparency and digitalisation as fundamental principles in water management and to enhance the use of management and metering data, with the aim of strengthening monitoring, assessment, accountability and decision-making, while optimising and simplifying reporting obligations; calls for digitally enabled water technologies to facilitate real-time, sample-based and distance monitoring and reporting on water quality, leakages, usage and resources; calls for improved efficiency in the use of public funds and public spending in this area; recognises that widespread deployment of innovative digital technologies needs to be accompanied by digital skills training;

    96.  Emphasises the need to promote digitalisation and data-centric solutions in building a water-smart society; stresses the need to develop digital solutions for monitoring water consumption and optimising the use of water resources across all sectors; calls on the Commission, in cooperation with the Member States, to provide financial support for the implementation of smart water management systems, focusing on the needs of small and medium-sized enterprises (SMEs);

    97.  Points out that water systems, including water treatment and distribution systems, are considered one of the nation’s critical infrastructures and security pillars, and hence key for the EU’s strategic autonomy, and require increased protection and the ability of utilities to detect, respond to, and recover from physical and cyberthreats and cyberattacks; notes that a higher level of digitalisation comes with new vulnerabilities; points out that, in the event of a threat or an attack, water system operators can lose their ability to control the flow and quality of the water or lose the ability to track the true status of the water system; insists that vulnerability assessments and an emergency response plan should be an integral part of the water management system in every Member State; encourages the promotion of information sharing about threats to cybersecurity and procedures to exchange best practice among operators, as well as to establish a cybersecurity culture through technical security measures, competence building and awareness creation and communication; draws attention to the measures and provisions in the NIS2 Directive and the Critical Entities Resilience Directive which could help mitigate the arising security risks; calls on the Commission to take the lead in reinforcing the EU-level coordination formats and to propose effective tools in the upcoming Preparedness Union Strategy with the aim of ensuring timely preparedness to tackle environmental and non-environmental risks to the water bodies that are threatening the EU’s overall security;

    98.  Calls on the Commission and the Member States to increase the involvement of women in decisions regarding water resilience; calls for the adoption of a methodological approach that effectively considers gender-related needs in the implementation of water supply projects, by implementing monitoring, reporting and tracking that use tools and indicators disaggregated by gender;

    99.  Notes that better data and data analysis are key to evidence-based decision-making and the swift identification of small changes in water quality that could present a threat to bodies of water, together with the evaluation of best practice and identification of the most cost-effective and impactful measures;

    100.  Stresses that improved, reliable and interoperable data on water supply, demand, distribution, accessibility and use are needed and that data points need to be established; urges the Commission and the Member States to enhance data collection and improve data interoperability across all levels to support the implementation of current water legislation, as well as to facilitate circular economy and water-smart industrial symbiosis strategies; highlights the fact that data and AI could be used in modelling water and energy consumption as well as reuse and recycling capacities;

    101.  Calls on the Commission to better recognise the fundamental role of the water sector in bolstering EU competiveness by fostering research and innovation and promoting entrepreneurship and talent; emphasises, in this regard, the importance of ramping up innovation in the water sector; points out that the European Innovation Centre for Industrial Transformation and Emissions, created as part of Directive 2010/75/EU, could play a role in this regard, as it evaluates the environmental performance of industrial technologies and gathers information on innovative industrial environmental techniques; points, further, to existing partnerships like the Water4All Partnership, a funding programme for scientific research;

    102.  Believes that there is a need to build and nurture multi-stakeholder platforms to promote innovation uptake at all levels, local and national; recommends that these platforms involve a wide range of participants – the public and private sectors, and civil society associations – to build a coalition of partners to bring about change; supports the promotion of knowledge sharing on how digital water technologies can support the implementation of existing EU water legislation, as well as capacity building at local, regional and national levels; calls on the Commission and the Members States to expand digital skills, and research and development (R&D) programmes targeting water, including through collaboration with universities, research centres and SMEs;

    103.  Acknowledges the critical role of data centres in the digital economy; notes with concern that the rapid expansion of the technology could lead to a substantial increase in AI’s demand for water resources associated with their operations, which could undermine the environmental benefits that AI promises to deliver, such as resource optimisation and carbon emission reductions, and stresses the need to integrate water efficiency measures in their design and operation; urges the Commission to address the use of water resources by information and communications technologies (ICT) and, in particular, by AI and data centres in its EWRS, in particular by encouraging data centres to reuse treated water and to promote the design of more efficient chips and components to reduce the need for cooling; recommends that the Member States prioritise water resilience strategies that address the specific challenges posed by data centres to ensure the sustainability of both the digital and the environmental agendas;

    104.  Recalls that seawater desalination is the process of removing salt from sea or brackish water to make it useable for a range of ‘fit for use’ purposes, including drinking, and that it is thus an important technological solution for people’s livelihoods; notes that, at the same time, desalination is an energy-intensive process and should ideally be done using renewable energy, whenever possible, in order to minimise environmental impacts; reiterates that desalination produces a by-product, brine (a concentrated salt solution), that must be properly disposed of to avoid adverse impacts on the marine environment; considers, therefore, that desalination based on reverse osmosis or thermal technologies should be applied, if other more environmentally sustainable options are not available or cannot be implemented, particularly in remote areas and islands; highlights, in this regard, the ongoing work on new technological solutions, such as microbial desalination cells, offering an environmentally sustainable and innovative alternative to traditional desalination methods, particularly to provide clean water and wastewater treatment to small, isolated locations without electricity;

    105.  Stresses the need for increased funding and R&D into technologies such as innovative desalination techniques in order to increase the efficiency, sustainability and the scaling up of such technologies; calls for research into the possibilities of using such technologies in agriculture to diversify the water supply points and therefore decrease the vulnerability of the sector to water stress;

    106.  Notes that in the last decade, there have been many scientific breakthroughs for making water treatment smarter and more circular, with these solutions offering opportunities for using digital solutions, AI and remote sensing to use water more efficiently and by reusing treated wastewater for irrigation and recovering energy and nutrients from wastewater;

    107.  Calls on the Commission and the Member States to address the regulatory obstacles within the single market to facilitate the development, scaling-up, and placing on the market of innovative biotechnology and biomanufacturing solutions and the promotion of cleaner manufacturing and circularity;

    108.  Calls for the funding, development and authorisation of innovative solutions for crop protection and fertilisation, including biological control agents and active substances with lower impact on the environment, which are needed for a just transition to more sustainable agricultural systems;

    109.  Calls for specific programmes to be established for the cleaning and conservation of river channels, ensuring adequate flow and reducing the accumulation of debris and sediment that can affect water storage and distribution capacity;

    Cross-border and international cooperation

    110.  Stresses the need for a comprehensive EWRS that fosters cross-border cooperation, more uniform data collection and reporting, sharing best practice between local, regional and national actors, ensuring sustainable water management and equitable resource distribution among the Member States, preventing water challenges such as scarcity and flood risk from being passed on to other Member States;

    111.  Emphasises that climate change represents a major threat to water resources and aquatic ecosystems; notes that floods and water scarcity compromise food and water security and the health of the general population, ultimately affecting social cohesion and stability; recognises that water resilience is crucial for preventing and addressing current and future health, food, energy and security crises; emphasises that water resilience promotes transboundary water cooperation, serving as a catalyst for peace and security, as countries are interconnected through shared rivers and groundwater resources;

    112.  Calls for increased cross-border cooperation between the Member States in the management of shared river basins and groundwater aquifers and in the effective collection and sharing of data on water quality, pollution levels and water levels; recommends the establishment of regional cooperation centres to coordinate the implementation of joint water resilience strategies, taking into account the climate, social and economic challenges of each territory;

    113.  Calls for enhanced international cooperation, including at the level of river basins, to address the growing water crisis, ensure clean and high-quality water, promote sustainable water management and implement various innovative water technologies, including nature-based solutions; calls for the anchoring of cooperation across borders at operational, tactical and strategic levels;

    114.  Calls for the establishment of cross-border projects under Interreg and other EU funds to improve regional cooperation in the management of water resources, with a particular focus on ensuring the fair distribution of water between sectors and Member States;

    115.  Stresses the need to strengthen EU monitoring capacities through digitalisation and modern technologies, including satellite surveillance and real-time pollution tracking, which are essential for preventing and combating cross-border pollution;

    116.  Urges the Commission to implement a specific diplomatic role dedicated to resolving water-related conflicts, promoting water cooperation and protecting water sources and systems, particularly during armed conflicts and in transboundary contexts;

    117.  Urges the EU to lead international efforts to protect and restore water ecosystems in line with the SDG 6 on clean water and sanitation;

    o
    o   o

    118.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 243, 9.7.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/1119/oj.
    (2) OJ L 327, 22.12.2000, p. 1, ELI: http://data.europa.eu/eli/dir/2000/60/oj.
    (3) OJ L 372, 27.12.2006, p. 19, ELI: http://data.europa.eu/eli/dir/2006/118/oj.
    (4) OJ L 348, 24.12.2008, p. 84, ELI: http://data.europa.eu/eli/dir/2008/105/oj.
    (5) OJ L 288, 6.11.2007, p. 27, ELI: http://data.europa.eu/eli/dir/2007/60/oj.
    (6) OJ L 435, 23.12.2020, p. 1, ELI: http://data.europa.eu/eli/dir/2020/2184/oj.
    (7) OJ L 177, 5.6.2020, p. 32, ELI: http://data.europa.eu/eli/reg/2020/741/oj.
    (8) OJ L 164, 25.6.2008, p. 19, ELI: http://data.europa.eu/eli/dir/2008/56/oj.
    (9) OJ L, 2024/3019, 12.12.2024, ELI: http://data.europa.eu/eli/dir/2024/3019/oj.
    (10) OJ L, 2024/1785, 15.7.2024, ELI: http://data.europa.eu/eli/dir/2024/1785/oj.
    (11) OJ L 375, 31.12.1991, p. 1, ELI: http://data.europa.eu/eli/dir/1991/676/oj.
    (12) OJ L, 2024/1991, 29.7.2024, ELI: http://data.europa.eu/eli/reg/2024/1991/oj.
    (13) OJ L 333, 27.12.2022, p. 164, ELI: http://data.europa.eu/eli/dir/2022/2557/oj.
    (14) OJ L 333, 27.12.2022, p. 80, ELI: http://data.europa.eu/eli/dir/2022/2555/oj.
    (15) OJ L 309, 24.11.2009, p. 71, ELI: http://data.europa.eu/eli/dir/2009/128/oj.
    (16) OJ L 435, 6.12.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/2115/oj.
    (17) OJ L, 2024/3190, 31.12.2024, ELI: http://data.europa.eu/eli/reg/2024/3190/oj.
    (18) OJ C 132, 14.4.2023, p. 54.
    (19) OJ C, C/2024/7216, 10.12.2024, ELI: http://data.europa.eu/eli/C/2024/7216/oj.
    (20) OJ C 132, 14.4.2023, p. 106.
    (21) OJ C 232, 16.6.2021, p. 28.
    (22) OJ C, C/2025/808, 11.2.2025, ELI: http://data.europa.eu/eli/C/2025/808/oj.
    (23) OJ C 445, 29.10.2021, p. 126.
    (24) OJ C 316, 22.9.2017, p. 99.
    (25) Texts adopted, P9_TA(2024)0358.
    (26) World Meteorological Organization, 2021 State of Climate Services – Water, WMO-No 1278, WMO, Geneva, 2021.
    (27) European Environment Agency, Water resources across Europe – confronting water scarcity and drought, EEA Report 2/2009.
    (28) EEA Report 07/2024.
    (29) WWF, High Cost of Cheap Water, WWF, Gland, 2021.
    (30) EEA Report 07/2024.
    (31) European Commission, Attitudes of Europeans towards the environment, Special Eurobarometer 550, May 2024.
    (32) European Commission: Directorate-General for Environment, et al., Implementation of water balances in the EU – Final report, Publications Office of the European Union, 2024.
    (33) Disclosure Insight Action (CDP) and Planet Tracker, High and Dry. How Water Issues Are Stranding Assets, 2022.
    (34) EEA Report 07/2024.
    (35) European Environment Agency, ‘Water abstraction by economic sector in the 27 EU Member States, 2000-2022’, European Environment Agency website, 5 December 2024, https://www.eea.europa.eu/en/analysis/indicators/water-abstraction-by-source-and/water-abstraction-by-economic?activeTab=8a280073-bf94-4717-b3e2-1374b57ca99d.
    (36) Eurostat, ‘Archive: Water use in industry’, Eurostat website, https://ec.europa.eu/eurostat/statistics-explained/index.php?title=Archive:Water_use_in_industry&oldid=196132#Further_Eurostat_information.
    (37) EEA Report 07/2024.
    (38) Food and Agriculture Organization of the United Nations, Water accounting and auditing, A sourcebook, FAO Water Reports 43, FAO, Rome, 2016.
    (39) European Investment Bank, Wastewater as a resource, EIB, 2022.
    (40) European Commission: Directorate-General for Environment, ‘Water reuse: New EU rules to improve access to safe irrigation’, European Commission website, 26 June 2023, https://environment.ec.europa.eu/news/water-reuse-new-eu-rules-improve-access-safe-irrigation-2023-06-26_en.
    (41) European Commission: Directorate-General for Environment, ‘Zero pollution: Improved quality and access to drinking water’, European Commission website, 12 January 2023, https://environment.ec.europa.eu/news/improved-quality-and-access-drinking-water-all-europeans-2023-01-12_en.
    (42) EEA Report 07/2024.
    (43) Ibid.
    (44) Ibid.
    (45) Ibid.
    (46) Ibid.
    (47) Ibid.
    (48) European Environment Agency, ‘Industrial pollutant releases to water in Europe’, European Environment Agency website, 30 May 2024, https://www.eea.europa.eu/en/analysis/indicators/industrial-pollutant-releases-to-water.
    (49) Directive 2010/75/EU of the European Parliament and of the Council of 24 November 2010 on industrial emissions (integrated pollution prevention and control) (OJ L 334, 17.12.2010, p. 17, ELI: http://data.europa.eu/eli/dir/2010/75/oj).
    (50) European Commission ‘Nitrates’, European Commission website, https://environment.ec.europa.eu/topics/water/nitrates_en#implementation.
    (51) European Environment Agency, ‘Public exposure to widely used Bisphenol A exceeds acceptable health safety levels’, European Environment Agency website, 14 September 2023, https://www.eea.europa.eu/en/newsroom/news/public-exposure-to-bisphenol-a.
    (52) European Environment Agency, European Climate Risk Assessment, EEA Report 01/2024.
    (53) Cammalleri, C. et al., Global warming and drought impacts in the EU, JRC Technical Report , Publications Office of the European Union, Luxembourg.
    (54) EEA Report 07/2024.
    (55) Feyen, L. et al., Climate change impacts and adaptation in Europe, JRC PESETA IV final report, Publications Office of the European Union, Luxembourg.
    (56) European Environment AgencyEuropean Climate Risk Assessment, EEA Report 01/2024.
    (57) United Nations Office for Disaster Risk Reduction, GAR Special Report on Drought 2021, Geneva, UNDRR, 2021.
    (58) Council conclusions of 14 October 2024 on Desertification, Land Degradation and Drought.
    (59) EEA Report 07/2024.
    (60) Directive (EU) 2024/1203 of the European Parliament and of the Council of 11 April 2024 on the protection of the environment through criminal law and replacing Directives 2008/99/EC and 2009/123/EC (OJ L, 2024/1203, 30.4.2024, ELI: http://data.europa.eu/eli/dir/2024/1203/oj).
    (61) European Patent Office, Innovation in water-related technologies, EPO, Munich 2024.
    (62) EEA Report 07/2024.
    (63) European Commission JRC Science for Policy Report, ‘Technical proposals for the safe use of processed manure above the threshold established for Nitrate Vulnerable Zones by the Nitrates Directive (91/676/EEC)’, 2020.
    (64) Regulation (EC) No 1935/2004 of the European Parliament and of the Council of 27 October 2004 on materials and articles intended to come into contact with food and repealing Directives 80/590/EEC and 89/109/EEC (OJ L 338, 13.11.2004, p. 4, ELI: http://data.europa.eu/eli/reg/2004/1935/oj).
    (65) European Environment Agency,‘Industrial pollutant releases to water in Europe, European Environment Agency website, 30 May 2024, https://www.eea.europa.eu/en/analysis/indicators/industrial-pollutant-releases-to-water.
    (66) United Nations Office for Disaster Risk Reduction, Build Back Better in recovery, rehabilitation and reconstruction, UNISDR, Geneva, 2019.
    (67) European Commission: Directorate-General for Environment et al. Stock-taking analysis and outlook of drought policies, planning and management in EU Member States – Final Report, Publications Office of the European Union, 2023.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – A revamped long-term budget for the Union in a changing world – P10_TA(2025)0090 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to Articles 311, 312, 323 and 324 of the Treaty on the Functioning of the European Union (TFEU),

    –  having regard to Council Regulation (EU, Euratom) 2020/2093 of 17 December 2020 laying down the multiannual financial framework for the years 2021 to 2027(1) and to the joint declarations agreed between Parliament, the Council and the Commission in this context and the related unilateral declarations,

    –  having regard to Council Decision (EU, Euratom) 2020/2053 of 14 December 2020 on the system of own resources of the European Union and repealing Decision 2014/335/EU, Euratom(2),

    –  having regard to the amended Commission proposal of 23 June 2023 for a Council decision amending Decision (EU, Euratom) 2020/2053 on the system of own resources of the European Union (COM(2023)0331),

    –  having regard to the Interinstitutional Agreement of 16 December 2020 between the European Parliament, the Council of the European Union and the European Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management, as well as on new own resources, including a roadmap towards the introduction of new own resources(3) (the IIA),

    –  having regard to Regulation (EU, Euratom) 2024/2509 of the European Parliament and of the Council of 23 September 2024 on the financial rules applicable to the general budget of the Union (recast)(4) (the Financial Regulation),

    –  having regard to Regulation (EU, Euratom) 2020/2092 of the European Parliament and of the Council of 16 December 2020 on a general regime of conditionality for the protection of the Union budget(5) (the Rule of Law Conditionality Regulation),

    –  having regard to its position of 27 February 2024 on the draft Council regulation amending Regulation (EU, Euratom) 2020/2093 laying down the multiannual financial framework for the years 2021 to 2027(6),

    –  having regard to its resolution of 10 May 2023 on own resources: a new start for EU finances, a new start for Europe(7),

    –  having regard to its resolution of 15 December 2022 on upscaling the 2021-2027 multiannual financial framework: a resilient EU budget fit for new challenges(8),

    –  having regard to its position of 16 December 2020 on the draft Council regulation laying down the multiannual financial framework for the years 2021 to 2027(9),

    –  having regard to the Interinstitutional Proclamation on the European Pillar of Social Rights of 13 December 2017(10) and to the Commission Action Plan of 4 March 2021 on the implementation of the European Pillar of Social Rights (COM(2021)0102),

    –  having regard to the Agreement adopted at the 15th Conference of the Parties to the Convention on Biological Diversity (COP 15) in Montreal on 19 December 2022 (Kunming-Montreal Global Biodiversity Framework),

    –  having regard to the Agreement adopted at the 21st Conference of the Parties to the UNFCCC (COP 21) in Paris on 12 December 2015 (the Paris Agreement),

    –  having regard to the United Nations Sustainable Development Goals,

    –  having regard to the report of 30 October 2024 by Sauli Niinistö entitled ‘Safer together – strengthening Europe’s civilian and military preparedness and readiness’ (the Niinistö report),

    –  having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’ (the Draghi report),

    –  having regard to the report of 4 September 2024 of the Strategic Dialogue on the Future of EU Agriculture entitled ‘A shared prospect for farming and food in Europe’,

    –  having regard to the report of 17 April 2024 by Enrico Letta entitled ‘Much more than a market – speed, security, solidarity: empowering the Single Market to deliver a sustainable future and prosperity for all EU Citizens’ (the Letta report),

    –  having regard to the report of 20 February 2024 of the High-Level Group on the Future of Cohesion Policy entitled ‘Forging a sustainable future together – cohesion for a competitive and inclusive Europe’,

    –  having regard to the Budapest Declaration on the New European Competitiveness Deal,

    –  having regard to the joint communication of 26 March 2025 entitled ‘European Preparedness Union Strategy’ (JOIN(2025)0130),

    –  having regard to the joint white paper of 19 March 2025 entitled ‘European Defence Readiness 2030’ (JOIN(2025)0120),

    –  having regard to the Commission communication of 7 March 2025 entitled ‘A Roadmap for Women’s Rights’ (COM(2025)0097),

    –  having regard to the Commission communication of 26 February 2025 entitled ‘The Clean Industrial Deal: a joint roadmap for competitiveness and decarbonisation’ (COM(2025)0085),

    –  having regard to the Commission communication of 19 February 2025 entitled ‘A Vision for Agriculture and Food’ (COM(2025)0075),

    –  having regard to the Commission communication of 11 February 2025 entitled ‘The road to the next multiannual financial framework’ (COM(2025)0046),

    –  having regard to the Commission communication of 29 January 2025 entitled ‘A Competitiveness Compass for the EU’ (COM(2025)0030),

    –  having regard to the Commission communication of 9 December 2021 entitled ‘Building an economy that works for people: an action plan for the social economy’ (COM(2021)0778),

    –  having regard to the European Council conclusions of 20 March 2025, 6 March 2025 and 19 December 2024,

    –  having regard to the political guidelines of 18 July 2024 for the next European Commission 2024-2029,

    –  having regard to the opinion of the Committee of the Regions of 20 November 2024 entitled ‘EU budget and place-based policies: proposals for new design and delivery mechanisms in the MFF post-2027’(11),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the opinions of the Committee on Foreign Affairs, the Committee on Development, the Committee on Budgetary Control, the Committee on Economic and Monetary Affairs, the Committee on Employment and Social Affairs, the Committee on the Environment, Climate and Food Safety, the Committee on Industry, Research and Energy, the Committee on Internal Market and Consumer Protection, the Committee on Transport and Tourism, the Committee on Regional Development, the Committee on Agriculture and Rural Development, the Committee on Culture and Education, the Committee on Civil Liberties, Justice and Home Affairs, the Committee on Constitutional Affairs, and the Committee on Women’s Rights and Gender Equality,

    –  having regard to the report of the Committee on Budgets (A10-0076/2025),

    A.  whereas, under Article 311 TFEU, the Union is required to provide itself with the means necessary to attain its objectives and carry through its policies;

    B.  whereas the Union budget is primarily an investment tool that can achieve economies of scale unattainable at Member State level and support European public goods, in particular through cross-border projects; whereas all spending through the Union budget must provide European added value and deliver discernible net benefits compared to spending at national or sub-national level, leading to real and lasting results;

    C.  whereas spending through the Union budget, if effectively targeted, aligned with the Union’s political priorities and better coordinated with spending at national level, helps to avoid fragmentation in the single market, promote upwards convergence, decrease inequalities and boost the overall impact of public investment; whereas public investment is essential as a catalyst for private investment in sectors where the market alone cannot drive the required investment;

    D.  whereas the NextGenerationEU recovery instrument (NGEU) established in the wake of the COVID-19 pandemic enabled significant additional investment capacity of EUR 750 billion in 2018 prices – beyond the Union budget, which amounts to 1,1 % of the EU-27’s gross national income (GNI) – prompting a swift recovery and return to growth and supporting the green and digital transitions; whereas NGEU will not be in place post-2027;

    E.  whereas in 2022 Member States spent an average of 1,4 % of gross domestic product (GDP) on State aid – significantly more than their contribution to the Union budget – with over half of the State aid unrelated to crises;

    F.  whereas the Union budget, bolstered by NGEU and loans through the SURE scheme, has been instrumental in alleviating the economic and social impact of the COVID-19 crisis and in responding to the effects of Russia’s war of aggression against Ukraine; whereas the Union budget remains ill-equipped, in terms of size, structure and rules, to fully play its role in adjusting to evolving spending needs, addressing shocks and responding to crises and giving practical effect to the principle of solidarity, and to enable the Union to fulfil its objectives as established under the Treaties;

    G.  whereas people rightly expect more from the Union and its budget, including the capacity to respond quickly and effectively to evolving needs and to provide them with the necessary support, especially in times of crisis;

    H.  whereas, since the adoption of the current multiannual financial framework (MFF), the political, economic and social context has changed beyond recognition, compounding underlying structural challenges for the Union and leading to a substantial revision of the MFF in 2024;

    I.  whereas the context in which the Commission will prepare its proposals for the post-2027 MFF is every bit as challenging, with the established global and geopolitical order changing quickly and radically, the return of large-scale warfare in the Union’s immediate neighbourhood, a highly challenging economic and social backdrop and the worsening climate and biodiversity crisis; whereas, as the Commission has made clear, the status quo is not an option and the Union budget will need to change accordingly;

    J.  whereas the US administration has decided to retreat from the country’s post-war global role in guaranteeing peace and security, in leading on global governance in the rules-based, multilateral international order and in providing essential development and humanitarian aid to those most in need around the world; whereas the Union will therefore have to step up to fill part of the void the US appears set to leave, placing additional demands on the budget;

    K.  whereas the Union has committed to take all the steps needed to achieve climate neutrality by 2050 at the latest and to protect nature and reverse biodiversity loss; whereas delivering on the policy framework put in place to achieve this objective will require substantial investment; whereas the Union budget will have to play a key role in providing and incentivising that investment;

    L.  whereas, in order to compensate for the budget’s shortcomings, there have been numerous workaround solutions that make the budget more opaque, leaving the public in the dark about the real volume of Union spending, undermining the longer-term predictability of investment the budget is designed to provide and undercutting not only the principle of budget unity, but also Parliament’s role as a legislator and budgetary and discharge authority and in holding the executive to account;

    M.  whereas the Union is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, including the rights of persons belonging to minorities; whereas breaches of those values undermine the cohesion of the Union, erode the rights of Union citizens and weaken mutual trust among Member States;

    1.  Insists that, in a fast changing world where people rightly expect more from the Union and its budget and where the Union is confronted with a growing number of crises, the next MFF must be endowed with increased resources compared to the 2021-2027 period, moving away from the historically restrictive, self-imposed level of 1 % of GNI;

    2.  Underscores that the next MFF must focus on financing European public goods with discernible added value compared to national spending; highlights the need for enhanced synergies and better coordination between Union and national spending; emphasises that spending will have to address major challenges, such as the return of large-scale warfare in the Union’s immediate neighbourhood, a highly challenging economic and social backdrop, a competitiveness gap and the worsening climate and biodiversity crisis;

    3.  Considers that the ‘one national plan per Member State’ approach as envisaged by the Commission, with the Recovery and Resilience Facility model as a blueprint, cannot be the basis for shared management spending post-2027; underlines that the design of shared management spending under the next MFF must fully safeguard Parliament’s roles as legislator and budgetary and discharge authority and be designed and implemented through close collaboration with regional and local authorities and all relevant stakeholders;

    4.  Calls for the next MFF to continue support for economic, social and territorial cohesion in order to help bind the Union together, deepen the single market, promote convergence and reduce inequality, poverty and social exclusion;

    5.  Considers that the idea of an umbrella Competitiveness Fund merging existing programmes as envisaged by the Commission is not fit for purpose; stresses that the fund should instead be a new instrument taking advantage of a toolbox of funding based on lessons learned from InvestEU and the Innovation Fund and complementing existing, highly successful programmes;

    6.  Stresses that, in particular in the light of the US’s retreat from its role as a global guarantor of peace and security, there is a clear need to progress towards a genuine Defence Union, with the next MFF supporting a comprehensive security approach through an increase in investment; stresses that defence spending cannot come at the expense of nor lead to a reduction in long-term investment in the economic, social and territorial cohesion of the Union;

    7.  Calls for genuine simplification for final beneficiaries by avoiding programmes with overlapping objectives, diverging eligibility criteria and different rules governing horizontal provisions; underlines that simplification cannot mean more leeway for the Commission without the necessary checks and balances and must therefore be achieved with full respect for the institutional balance provided for in the Treaties;

    8.  Insists on enhanced in-built crisis response capacity in the next MFF and sufficient margins under each heading; stresses that, alongside predictability for investment, spending programmes should retain a substantial in-built flexibility reserve, with allocation to specific policy objectives to be decided by the budgetary authority; underlines that flexibility for humanitarian aid should be ring-fenced; considers that the post-2027 MFF should include two special instruments – one dedicated to ensuring solidarity in the event of natural disasters and one for general-purpose crisis response;

    9.  Underlines that compliance with Union values and fundamental rights is an essential pre-requisite to access EU funds; insists that the Union budget be protected against misuse, fraud and breaches of the principle of the rule of law and calls for a stronger link between the rule of law and the Union budget post-2027;

    10.  Underlines that the repayment of NGEU borrowing must not endanger the financing of EU policies and priorities; stresses, therefore, that all costs related to borrowing backed by the Union budget or the budgetary headroom be treated distinctly from appropriations for EU programmes within the future MFF architecture;

    11.  Calls on the Council to adopt new own resources as a matter of urgency in order to enable sustainable repayment of NGEU borrowing; stresses that new genuine own resources, beyond the IIA, are essential for the Union’s higher spending needs; considers that all instruments and tools should be explored in order to provide the Union with the necessary resources, and considers, in this respect, that joint borrowing presents a viable option to ensure that the Union has sufficient resources to respond to acute Union-wide crises, such as the ongoing crisis in the area of security and defence;

    12.  Stands ready to work constructively with the Council and Commission to deliver a long-term budget that addresses the Union’s needs; highlights that the post-2027 MFF is being constructed in a far from ‘business as usual’ context and takes seriously its institutional role as enshrined in the Treaties; insists that it will only approve a long-term budget that is fit for purpose for the Union in a changing world and calls for swift adoption of the MFF to enable timely implementation of spending programmes from 1 January 2028;

    A long-term budget with a renewed spending focus

    13.  Considers that, in view of the structural challenges facing the Union, the post-2027 MFF should adjust its spending focus to ensure that the Union can meet its strategic policy aims as detailed below;

    Competitiveness, strategic autonomy, social, economic and territorial cohesion and resilience

    14.  Is convinced that boosting competitiveness, decarbonising the economy and enhancing the Union’s innovation capacity are central priorities for the post-2027 MFF and are vital to ensure long-term, sustainable and inclusive growth and a thriving, more resilient economy and society;

    15.  Considers that the Union must develop a competitiveness framework in line with its own values and political aims and that competitiveness must foster not only economic growth, but also social, economic and territorial cohesion and environmental sustainability as underlined in both the Draghi and Letta reports;

    16.  Underlines that, as spelt out in the Letta and Draghi reports, the European economy and social model are under intense strain, with the productivity, competitiveness and skills gap having knock-on effects on the quality of jobs and on living standards for Europeans already grappling with high housing, energy and food prices; is concerned that a lack of job opportunities and high costs of living increase the risk of a brain drain away from Europe;

    17.  Points out that Draghi puts the annual investment gap with respect to innovation and infrastructure at EUR 750-800 billion per year between 2025 and 2030; underlines that the Union budget must play a vital role but it cannot cover that shortfall alone, and that the bulk of the effort will have to come from the private sector – points to the need to exploit synergies between public and private investment, in particular by simplifying and harmonising the EU investment architecture;

    18.  Stresses that the Union budget must be carefully coordinated with national spending, so as to ensure complementarity, and must be designed such that it can de-risk, mobilise and leverage private investment effectively, enabling start-ups and SMEs to access funds more readily; calls, therefore, for programmes such as InvestEU, which ensures additionality and follows a market-based, demand-driven approach, to be significantly reinforced in the next MFF; considers that financial instruments and budgetary guarantees are an effective use of resources to achieve critical Union policy goals and calls for them to be further simplified;

    19.  Insists that more must be done to maximise the potential of the role of the European Investment Bank (EIB) Group – together with other international and national financial institutions – in lending and de-risking in strategic policy areas, such as climate and, latterly, security and defence projects; calls for an increased risk appetite and ambition from the EIB Group to crowd in investment, based on a strong capital position, and for a reinforced investment partnership to ensure that every euro spent at Union level is used in the most effective manner;

    20.  Emphasises that funding for research and innovation, including support for basic research, should be significantly increased, should be focused on the Union’s strategic priorities, should continue to be determined by the principle of excellence and should remain merit-based; considers that there should be sufficient resources across the MFF and at national level to fund all high-quality projects throughout the innovation cycle and to achieve the 3 % GDP target for research and development spending by 2030;

    21.  Stresses that the next MFF, building on the current Connecting Europe Facility, should include much greater, directly managed funding for energy, transport and digital infrastructure, with priority given to cross-border connections and national links with European added value; considers that such infrastructure is an absolute precondition for a successful deepening of the single market and for increasing the Union’s resilience in a changing geopolitical order;

    22.  Points out that a secure and robust space sector is critical for the Union’s autonomy and sovereignty and therefore needs sustained investment;

    23.  Underlines that a more competitive, productive and socially inclusive economy helps to generate high-quality, well-paid jobs, thus enhancing people’s standard of living; emphasises that, through programmes such as the European Social Fund+ and Erasmus+, the Union budget can play an important role in supporting education and training systems, enhancing social inclusion, boosting workforce adaptability through reskilling and upskilling, and thus preparing people for employment in a modern economy;

    24.  Insists that the Union budget should continue to support important economic and job-creating sectors where the Union is already a world leader, such as tourism and the cultural and creative sectors; underscores the need for dedicated funding for tourism, including to implement the EU Strategy for Sustainable Tourism, in the Union budget post-2027; points to the importance of Creative Europe in contributing to Europe’s diversity and competitiveness and in supporting vibrant societies;

    25.  Stresses that, in order to compete with other major global players, the European economy must also become more competitive and resilient on the supply side by investing more in the Union’s open strategic autonomy through enhanced industrial policy and a focus on strategic sectors, resource-efficiency and critical technologies to reduce dependence on third countries;

    26.  Considers that, in light of the above, the idea of an umbrella Competitiveness Fund merging existing programmes as envisaged by the Commission is not fit for purpose; stresses that the fund should instead be a new instrument taking advantage of a toolbox of funding based on lessons learned from InvestEU and the Innovation Fund; recalls that, under Article 182 TFEU, the Union is required to adopt a framework programme for research;

    27.  Notes that, in the Commission communication on the competitiveness compass, the Commission argues that a new competitiveness coordination tool should be established in order to better align industrial and research policies and investment between EU and national level; notes that the proposed new tool is envisaged as part of a ‘new, lean steering mechanism’ designed ‘to reinforce the link between overall policy coordination and the EU budget’; insists that Parliament must play a full decision-making role in both mechanisms;

    28.  Emphasises that food security is a vital component of strategic autonomy and that the next MFF must continue to support the competitiveness and resilience of the Union’s farming and fisheries sectors, including small-scale and young farmers and fishers, and help the sectors to better protect the climate and biodiversity, as well as the seas and oceans; highlights that a modern and simplified common agricultural policy is crucial for increasing productivity through technical progress, ensuring a fair standard of living for farmers, guaranteeing food security and the production of safe, high-quality and affordable food for Europeans, fostering generational renewal and ensuring the viability of rural areas;

    29.  Points out that the farming sector is particularly vulnerable to inflationary shocks which affect farmers’ purchasing power; calls for an increased and dedicated budget for the CAP in the next MFF, safeguarding it from possible cuts, in order to maintain its integrity and commonality, as well as the coherence and interconnection between its first and second pillar, and therefore opposes the idea of integrating the CAP into a single fund for each Member State; calls for additional dedicated funding sources to be explored where appropriate, including outside of the CAP, in order to cope with natural disasters and provide incentives to farmers and foresters to contribute to climate change mitigation, biodiversity recovery and nature protection, without measures causing a regression in EU agricultural production;

    30.  Stresses that the new global challenges facing EU farmers, including the present geopolitical situation, climate change and rising input prices, require sound financial allocation in the next CAP; emphasises that, in order to address these challenges, taking into account the lessons learned from the COVID-19 crisis, and to avoid reductions to farmers’ support, the CAP urgently needs an increased budget in the next MFF that is indexed to inflation through annual re-evaluation; underlines, in that respect, that direct payments in the current form generate clear EU added value and should continue to strengthen income security, production and protection against price volatility, better targeting persons actively engaged in agricultural production and the provision of public goods, while respecting realistic and balanced EU environmental and social standards; calls for a fair and efficient distribution of CAP support within and among the Member States; calls for the continuation and reinforcement of measures that maintain production in vulnerable areas and guarantee the viability of rural communities and the adequacy of public infrastructure, specifically regarding digitalisation and particularly through the European Agricultural Fund for Rural Development, and the renewed involvement of local and regional authorities in the management of such measures; stresses the need to increase and reform the agricultural reserve in order to respond effectively and rapidly to future crises that the European agricultural sector will have to deal with, and to establish new tools for managing natural, market and sanitary risks, such as an EU reinsurance scheme to better mitigate the effects of future crises and provide greater stability for farmers; emphasises that specific solutions must be found for the farmers in eastern Europe who are most affected by the cascade effects of Russia’s war against Ukraine, such as high input prices, inflation and market disturbances; urges the Commission to continue to set up the necessary financial and legal framework for the food supply chain in order to strengthen the position of farmers and better combat unfair trading practices; calls on the Commission to support EU farmers by promoting agri-food products inside and outside the Union through a dynamic and stronger EU promotion policy; regrets the funding cuts made to the programme on the promotion of agricultural products during the review of the current MFF; emphasises that the next MFF must include dedicated funds for agri-tourism, female entrepreneurship, vocational training and technological innovation in agriculture;

    31.  Recalls that social, economic and territorial cohesion is a cornerstone of European integration and is vital in binding the Union together and deepening the single market; reaffirms, in that respect, the importance of the convergence process; underlines that a modernised cohesion policy must follow a decentralised, place-based, multilevel governance approach and be built around the shared management and partnership principle, fully involving local and regional authorities and relevant stakeholders, ensuring that resources are directed where they are most needed to reduce regional disparities;

    32.  Stresses that cohesion policy funding must tackle the key challenges the Union faces, such as demographic change and depopulation, and target the regions and people most in need; calls, furthermore, for enhanced access to EU funding for cities, regions and urban authorities; recalls that, under Article 349 TFEU, the Union is required to put in place specific measures for the outermost regions and stresses, therefore, the need for continued, targeted support for these regions in the next MFF, including via a reinforced programme of options specifically relating to remoteness and insularity (POSEI);

    33.  Recalls the importance of the social dimension of the European Union and of promoting the implementation of the European Pillar of Social Rights, its Action Plan and headline targets; emphasises that the Union budget should, therefore, play a pivotal role in reducing inequality, poverty and social exclusion, including by supporting children, families and vulnerable groups; recalls that around 20 million children in the Union are at risk of poverty and social exclusion; stresses that addressing child poverty across the Union requires appropriately funded, comprehensive and integrated measures, together with the efficient implementation of the European Child Guarantee at national level; emphasises that Parliament has consistently requested a dedicated budget within the ESF+ to support the Child Guarantee as a central pillar of the EU anti-poverty strategy;

    34.  Highlights, in this regard, the EU-wide housing crisis affecting millions of families and young people; stresses the need for enhanced support for housing through the Union budget, in particular via cohesion policy, and through other funding sources, such as the EIB Group and national promotional banks; acknowledges that, while Union financing cannot solve the housing crisis alone, it can play a crucial role in financing urgent measures and complementing broader Union and national efforts to improve housing affordability and enhance energy efficiency of the housing stock;

    35.  Points out that Russia’s war of aggression against Ukraine has had substantial economic and social consequences, in particular in Member States bordering Russia and Belarus; insists that the next MFF provide support to these regions;

    The green and digital transitions

    36.  Highlights that the green and digital transitions are inextricably linked to competitiveness, the modernisation of the economy and the resilience of society and act as catalysts for a future-oriented and resource-efficient economy; insists therefore, that the post-2027 MFF must continue to support and to further accelerate the twin transitions;

    37.  Recalls that the Union budget is an essential contributor to achieving climate neutrality by 2050, including through support for the 2030 and 2040 targets; underlines that the transition will require a decarbonisation of the economy, in particular through the deployment of clean technologies, improved energy and transport infrastructure and more energy-efficient housing; notes that the Commission estimates additional investment needs to achieve climate neutrality by 2050 at 1,5 % of GDP per year compared to the decade 2011-2020 and that, while the Union budget alone cannot cover the gap, it must remain a vital contributor; calls, therefore, for increased directly managed support for environment and biodiversity protection and climate action building on the current LIFE programme;

    38.  Underlines that industry will be central in the transition to net zero and the establishment of the Energy Union, and that support will be needed in helping some industrial sectors and their workers to adapt; stresses the importance of a just transition that must leave no one behind, requiring, inter alia, investment in regions that are heavily fossil-fuel dependent and increased support for vulnerable households, in particular through the Just Transition Mechanism and the Social Climate Fund;

    39.  Points to the profound technological shift under way, with technologies such as artificial intelligence and quantum both creating opportunities, in terms of the Union’s economic potential and global leadership and improvements to citizens’ lives, and posing reliability, ethical and sovereignty challenges; stresses that the next MFF must support research into, and the development and safe application of digital technologies and help people to hone the knowledge and skills they need to work with and use them;

    Security, defence and preparedness

    40.  Recalls that peace and security are the foundation for the Union’s prosperity, social model and competitiveness, and a vital pillar of the Union’s geopolitical standing; stresses that the next MFF must support a comprehensive security approach by investing significantly more in safeguarding the Union against the myriad threats it faces;

    41.  Underlines that, as the Niinistö report makes clear, multiple threats are combining to heighten instability and increase the Union’s vulnerability, chief among them the fragmenting global order, the security threat posed by Russia and Belarus, growing tensions globally, hostile international actors, the globalisation of criminal networks, hybrid campaigns – which include cyberattacks, foreign information manipulation, disinformation and interference and the instrumentalisation of migration – increasingly frequent and intense extreme weather events as a result of climate change, and health threats;

    42.  Points out that the Union has played a vital role in achieving lasting peace on its territory and must continue to do so by adjusting to the reality of war on its doorstep and the need to vastly boost defence infrastructure, capabilities and readiness, including through the Union budget, going far beyond the current allocation of less than 2 % of the MFF;

    43.  Notes that European defence capabilities suffer from decades of under-investment and that, according to the Commission, the defence spending gap currently stands at EUR 500 billion for the next decade; underlines that the Union budget alone cannot fill the gap, but has an important role to play, in conjunction with national budgets and with a focus on clear EU added value; considers that the Union budget and lending through the EIB Group can help incentivise investment in defence; stresses that defence spending must not come at the expense of social and environmental spending, nor must it lead to a reduction in funding for long-standing Union policies that have proved their worth over time;

    44.  Underlines the merits of the defence programmes and instruments put in place during the current MFF, which have enhanced joint research, production and procurement in the field of defence, providing a valuable foundation on which to build further Union policy and investment;

    45.  Emphasises that, given the geopolitical situation, there is a clear need to act and to progress towards a genuine Defence Union, in coordination with NATO and in full alignment with the neutrality commitments of individual Member States; concurs, in that regard, with the Commission’s analysis that the next MFF must provide a comprehensive and robust framework in support of EU defence;

    46.  Underscores the importance of a competitive and resilient European defence technological and industrial base; considers that enhanced joint EU-level investment in defence in the next MFF backed up by a clear and transparent governance structure can help to avoid duplication, generate economies of scale, and thus significant savings for Member States, reduce fragmentation and ensure the interoperability of equipment and systems; underscores the importance of technology in modern defence systems and therefore of investing in research, cyber-defence and cybersecurity and in dual-use products; points to the need to direct support towards the defence industry within the Union, thus strengthening strategic autonomy, creating quality high-skilled jobs, driving innovation and creating cross-border opportunities for EU businesses, including SMEs;

    47.  Points to the importance of increasing support in the budget for military mobility, which upgrades infrastructure for dual-use military and civilian purposes, enabling the large-scale movement of military equipment and personnel at short notice and thus contributing to the Union’s defence capabilities and collective security; highlights, in that regard, the importance of financing for the trans-European transport networks to enable their adaptation for dual-use purposes;

    48.  Emphasises that the Union needs to ramp up funding for preparedness across the board; is alarmed by the growing impact of natural disasters, which are often the result of climate change and are therefore likely to occur with greater frequency and intensity in the future; points out that, according to the 2024 European Climate Risk Assessment Report, cumulated economic losses from natural disasters could reach about 1,4 % of Union GDP;

    49.  Underlines, therefore, that, in addition to efforts to mitigate climate change through the green transition, significant investment is required to adapt to climate change, in particular to prevent and reduce the impact of natural disasters and severe weather events; considers that support for this purpose, such as through the current Union Civil Protection Mechanism, must be significantly increased in the next MFF and made available quickly to local and regional authorities, which are often on the frontline;

    50.  Emphasises that reconstruction and recovery measures after natural disasters must be based on the ‘build back better’ approach and prioritise nature-based solutions; stresses the importance of sustainable water management and security and hydric resilience as part of the Union’s overall preparedness strategy;

    51.  Recalls that the COVID-19 pandemic wreaked economic and social havoc globally and that a key lesson from the experience is that there is a need to prioritise investment in prevention of, preparedness for and response to health threats, in medical research and disease prevention, in access to critical medicines, in healthcare infrastructure, in physical and mental health and in the resilience and accessibility of public health systems in the Union; recalls that strategic autonomy in health is key to ensuring the Union’s preparedness in this area;

    52.  Considers that the next MFF must build on the work done in the current programming period by ensuring that the necessary investment is in place to build a genuine European Health Union that delivers for all citizens;

    53.  Underlines that, with technological developments, it has become easier for malicious and opportunistic foreign actors to spread disinformation, encourage online hate speech, interfere in elections and mount cyberattacks against the Union’s interests; insists that the next MFF must invest in enhanced cybersecurity capabilities and equip the Union to counter hybrid warfare in its various guises;

    54.  Stresses that a free, independent and pluralistic media is a fundamental component of Europe’s resilience, safeguarding not only the free flow of information but also a democratic mindset, critical thinking and informed decision-making; points to the importance of investment in independent and investigative journalism, fact-checking initiatives, digital and media literacy and critical thinking to safeguard against disinformation, foreign information manipulation and electoral interference as part of the European Democracy Shield initiative and therefore to guarantee democratic resilience; underscores the need for continued Union budget support for initiatives in these areas;

    55.  Underscores the importance of continued funding, in the next MFF, for effective protection of the EU’s external borders; underlines the need to counter transnational criminal networks and better protect victims of trafficking networks, and to strengthen resilience and response capabilities to address hybrid attacks and the instrumentalisation of migration, by third countries or hostile non-state actors; highlights, in particular, the need for support to frontline Member States for the purposes of securing the external borders of the EU;

    56.  Underlines that the EU’s resilience and preparedness are inextricably linked to those of its regional and global partners; emphasises that strengthening partners’ capacity to prevent, withstand and effectively respond to extreme weather events, health crises, hybrid campaigns, cyberattacks or armed conflict also lowers the risk of spill-over effects for Europe;

    External action and enlargement

    57.  Insists that, in a context of heightened global instability, the Union must continue to engage constructively with third countries and support peace, and conflict prevention, stability, prosperity, security, human rights, the rule of law, equality, democracy and sustainable development globally, in line with its global responsibility values and international commitments;

    58.  Regrets the fact that external action in the current MFF has been underfunded, leading to significant recourse to special instruments and substantial reinforcements in the mid-term revision; notes, in particular, that humanitarian aid funding has been woefully inadequate, prompting routine use of the Emergency Aid Reserve;

    59.  Underlines that the US’s retreat from its post-war global role in guaranteeing peace, security and democracy, in leading on global governance in the rules-based, multilateral international order and in providing essential development and humanitarian aid to those most in need around the world will leave an enormous gap and that the Union has a responsibility and overwhelming strategic interest in helping to fill that gap; calls on the Commission to address the consequences of the US’s retreat at the latest in its proposal for the post-2027 MFF;

    60.  Stresses that the next MFF must continue to tackle the most pressing global challenges, from fighting climate change, to providing relief in the event of natural disasters, preventing and addressing violent conflict and guaranteeing global security, ensuring global food security, improving healthcare and education systems, reducing poverty and inequality, promoting democracy, human rights, the rule of law and social justice and boosting competitiveness and the security of global supply chains, in full compliance with the principle of policy coherence for development; emphasises, in particular, the need for support for the Union’s Southern and Eastern Neighbourhoods;

    61.  Underlines that, in particular in light of the drastic cuts to the USAID budget, the budget must uphold the Union’s role as the world’s leading provider of development aid and climate finance in line with the Union’s global obligations and commitments; recalls, in that regard, that the Union and its Member States have collectively committed to allocating 0,7 % of their GNI to official development assistance and that poverty alleviation must remain its primary objective; insists that the budget must continue to support the Union in its efforts to defend the rules-based international order, democracy, multilateralism, human rights and fundamental values;

    62.  Insists that, given the unprecedented scale of humanitarian crises, mounting global challenges and uncertainty of US assistance under the current administration, humanitarian aid funding must be significantly enhanced and that its use must remain solely needs-based and respect the principles of neutrality, independence and impartiality; emphasises that the needs-based nature of humanitarian aid requires ring-fenced funding delivered through a stand-alone spending programme, distinct from other external action financing; underscores, furthermore, that effective humanitarian aid provision is contingent on predictability through a sufficient annual baseline allocation;

    63.  Emphasises that humanitarian aid, by its very nature, requires substantial flexibility and response capacity; considers, therefore, that, in addition to an adequate baseline figure, humanitarian aid will require significant ring-fenced flexibility in its design to enable an effective response to the growing crises;

    64.  Emphasises that, in a context in which global actors are increasingly using trade interdependence as a means of economic coercion, the Union must bolster its capacity to protect and advance its own strategic interests, develop more robust tools to counter coercion and ensure genuine reciprocity in its partnerships; stresses that such an approach requires the strategic allocation of external financing so as to support, for example, economic, security and energy partnerships that align with the Union’s values and strategic interests;

    65.  Considers that enlargement represents an opportunity to strengthen the Union as a geopolitical power and that the next MFF is pivotal for preparing the Union for enlargement and the candidate countries for accession; recalls that the stability, security and democratic resilience of the candidate countries are inextricably connected to those of the EU and require sustained strategic investment, linked to reforms, to support their convergence with Union standards; underlines the important role that citizens and civil society organisations play in the process of enlargement;

    66.  Points to the need for strategically targeted support for pre-accession and for growth and investment; is of the view that post-2027 pre-accession assistance should be provided in the form of both grants and loans; believes, in that context, that the future framework should allow for innovative financing mechanisms, as well as lending to candidate countries backed by the budgetary headroom (the difference between the own resources and the MFF ceilings);

    67.  Stresses that financial support must be conditional on the implementation of reforms aligned with the Union acquis and policies and adherence to Union values; emphasises, in this regard, the need for a strong governance model that ensures parliamentary accountability, oversight and control and a strong, effective anti-fraud architecture;

    68.  Reiterates its full support for Ukrainians in their fight for freedom and democracy and deplores the terrible suffering and impact resulting from Russia’s unprovoked and unjustifiable war of aggression; welcomes the decision to grant Ukraine and the neighbouring Republic of Moldova candidate country status and insists on the need to deploy the necessary funds to support their accession processes;

    69.  Underlines that pre-accession support to Ukraine has to be distinct from and additional to financial assistance for macroeconomic stability, reconstruction and post-war recovery, where needs are far more substantial and require a concerted international effort, of which support through the Union budget should be an important part;

    70.  Is convinced that the existing mandatory revision clause in the event of enlargement should be maintained in the next framework and that national envelopes should not be affected; underlines that the next MFF will also have to put in place appropriate transitional and phasing-in measures for key spending areas, such as cohesion and agriculture, based on a careful assessment of the impacts on different sectors;

    Fundamental rights, Union values and the rule of law

    71.  Emphasises the importance of the Union budget and programmes like Erasmus+ and Citizens, Equality, Rights and Values in promoting and protecting democracy and the Union’s values, fostering the Union’s common cultural heritage and European integration, enhancing citizen engagement, civic education and youth participation, safeguarding and promoting fundamental rights enshrined in the Charter of Fundamental Rights and the rule of law; calls, in this regard, for increased funding for Erasmus+ in the next MFF; points to the importance of the independence of the justice system, the sound functioning of national institutions, de-oligarchisation, robust support for and, in line with article 11(2) TEU, an active dialogue with civil society, which is vital for fostering an active civic space, ensuring accountability and transparency and informing policymakers about best practices from the ground;

    72.  Highlights, in that connection, that the recast of the Financial Regulation requires the Commission and the Member States, in the implementation of the budget, to ensure compliance with the Charter of Fundamental Rights and to respect the values on which the Union is founded, which are enshrined in Article 2 TEU; expects the Commission to ensure that the proposals for the next MFF, including for the spending programmes, are aligned with the Financial Regulation recast;

    73.  Stresses that instability in neighbouring regions and beyond, poverty, underlying trends in economic development, demographic changes and climate change, continue to generate migration flows towards the Union, placing significant pressure on asylum and migration systems; underlines that the post-2027 MFF must support the full and swift implementation of the Union’s Asylum and Migration Pact and effective return and readmission policies, in line with fundamental rights and EU values, including the principle of solidarity and fair sharing of responsibility; underlines, moreover, that, in line with the Pact, the EU must pursue enhanced cooperation and mutually beneficial partnerships with third countries on migration, with adequate parliamentary scrutiny, and that such cooperation must abide by EU and international law;

    74.  Underlines that compliance with Union values and fundamental rights is an essential pre-requisite to access EU funds; highlights the importance of strong links between respect for the rule of law and access to EU funds under the current MFF; believes that the protection of the Union’s financial interests depends on respect for the rule of law at national level; welcomes, in particular, the positive impact of the Rule of Law Conditionality Regulation in protecting the Union’s financial interests in cases of systemic and persistent breaches of the rule of law; calls on the Commission and the Council to apply the regulation strictly, consistently and without undue delay wherever necessary; emphasises that decisions to suspend or reduce Union funding over breaches of the rule of law must be based on objective criteria and not be guided by other considerations, nor be the outcome of negotiations;

    75.  Points to the need for a stronger link between the rule of law and the Union budget post-2027 and welcomes the Commission’s commitment to bolster links between the recommendations in the annual rule of law report and access to funds through the budget; calls on the Commission to outline, in the annual rule of law report from 2025 onwards, the extent to which identified weaknesses in rule of law regimes potentially pose a risk to the Union budget; welcomes, furthermore, the link between respect for Union values and the implementation of the budget and calls on the Commission to actively monitor Member States’ compliance with this principle in a unified manner and to take swift action in the event of non-compliance;

    76.  Calls for the consolidation of a robust rule of law toolbox, building on the current conditionality provisions under the Recovery and Resilience Facility (RRF), the horizontal enabling conditions in the Common Provisions Regulation and the relevant provisions of the Financial Regulation and insists that the toolbox should cover the entire Union budget; underlines the need for far greater transparency and consistency with regard to the application of tools to protect the rule of law and for Parliament’s role to be strengthened in the application and scrutiny of such measures; insists, furthermore, on the need for consistency across instruments when assessing breaches of the rule of law in Member States;

    77.  Recalls that the Rule of Law Conditionality Regulation provides that final recipients should not be deprived of the benefits of EU funds in the event of sanctions being applied to their government; believes that, to date, this provision has not been effective and stresses the importance of applying a smart conditionality approach so that beneficiaries are not penalised because of their government’s actions; calls on the Commission, in line with its stated intention in the political guidelines, to propose specific measures to ensure that local and regional authorities, civil society and other beneficiaries can continue to benefit from Union funding in cases of breaches of the rule of law by national governments without weakening the application of the regulation and maintaining the Member State’s obligation to pay under Union law;

    A long-term budget that mainstreams the Union’s policy objectives

    78.  Stresses that a long-term budget that is fully aligned with the Union’s strategic aims requires that key objectives be mainstreamed across the budget through a set of horizontal principles, building on the lessons from the current MFF and RRF;

    79.  Recalls that the implementation of horizontal principles should not lead to an excessive administrative burden on beneficiaries and be in line with the principle of proportionality; calls for innovative solutions and the use of automated reporting tools, including artificial intelligence, to achieve more efficient data collection;

    80.  Underlines, therefore, that the next MFF must ensure that, across the board, spending programmes pursue climate and biodiversity objectives, promote and protect rights and equal opportunities for all, including gender equality, support competitiveness and bolster the Union’s preparedness against threats;

    81.  Points out that effective mainstreaming is best achieved through a toolbox of measures, primarily through policy, project and regulatory design, thorough impact assessments and solid tracking of spending and, in specific cases, spending targets based on relevant and available data; welcomes the significant improvements in performance reporting in the current MFF, which allow for much better scrutiny of the impact of EU spending and calls for this to be further developed in the next programing period;

    82.  Welcomes the development of a methodology to track gender-based spending and considers that the lessons learnt, in particular as regards the collection of gender-disaggregated data, the monitoring of implementation and impact and administrative burden, should be applied in the next MFF in order to improve the methodology; calls on the Commission to explore the feasibility of gender budgeting in the next MFF; stresses, in the same vein, the need for a significant improvement in climate and biodiversity mainstreaming methodologies to move towards the measurement of impact;

    83.  Regrets that the Commission has not systematically conducted thorough impact assessments, including gender impact assessments, for all legislation involving spending through the budget and insists that this change;

    84.  Is pleased that the climate mainstreaming target of 30 % is projected to be exceeded in the current MFF; regrets, however, that the Union is not on track to meet the 10 % target for 2026 for biodiversity-related expenditure; insists that the targets in the IIA have nevertheless been a major factor in driving climate and biodiversity spending; calls on the Commission to adapt the spending targets contributing positively to climate and biodiversity in line with the Union policy ambitions in this regard, taking into account the investment needs for these policy ambitions;

    85.  Stresses, furthermore, that the Union budget should be implemented in line with Article 33(2) of the Financial Regulation, therefore without doing significant harm(12) to the specified objectives, respecting applicable working and employment conditions and taking into account the principle of gender equality;

    86.  Welcomes the Commission’s commitment to phase out all fossil fuel subsidies and environmentally harmful subsidies in the next MFF; expects the Commission to come forward with its planned roadmap in this regard as part of its proposal for the next MFF;

    A long-term budget with an effective administration at the service of Europeans

    87.  Underlines the need for Union policies to be underpinned by a well-functioning administration; insists that, post-2027, sufficient financial and staff resources be allocated from the outset so that Union institutions, bodies, decentralised agencies and the European Public Prosecutor’s Office can ensure effective and efficient policy design, high-quality delivery and enforcement, provide technical assistance, continue to attract the best people from all Member States, thus ensuring geographical balance, and have leeway to adjust to changing circumstances;

    88.  Regrets that the Union’s ability to implement policy effectively and protect its financial interests within the current MFF has been undermined by stretched administrative resources and a dogmatic application of a policy of stable staffing, despite increasing demands and responsibilities; points, for example, to the failure to provide sufficient staff to properly implement and enforce the Digital Services(13) and Digital Markets Acts(14), thus undercutting the legislation’s effectiveness and to the repeated redeployments from programmes to decentralised agencies to cover staffing needs; insists that staffing levels be determined by an objective needs assessment when legislation is proposed and definitively adopted, and factored into planning for administrative expenditure from the outset;

    89.  Emphasises that the Commission has sought, to some degree, to circumvent its own stable staffing policy by increasing staff attached to programmes and facilities and thus not covered by the administrative spending ceiling; underscores, however, that such an approach merely masks the problem and may ultimately undermine the operational capacity of programmes; insists, therefore, that additional responsibilities require administrative expenditure and must not erode programme envelopes;

    90.  Stresses that up-front investment in secure and interoperable IT infrastructure and data mining capabilities can also generate longer-term cost savings and hugely enhance policy delivery and tracking of spending;

    91.  Acknowledges that, in the absence of any correction mechanism in the current MFF, high inflation has significantly driven up statutory costs, requiring extensive use of special instruments to cover the shortfall; regrets that the Council elected not to take up the Commission’s proposal to raise the ceiling for administrative expenditure in the MFF revision, thus further eroding special instruments;

    A long-term budget that is simpler and more transparent

    92.  Stresses that the next MFF must be designed so as to simplify the lives of all beneficiaries by cutting unnecessary red tape; underlines that simplification will require harmonising rules and reporting requirements wherever possible, including, as relevant, ensuring consistency between the applicable rules at European, national and regional levels; underlines, in that respect, the need for a genuine, user-friendly single entry point for EU funding and a simplified application procedure designed in consultation with relevant stakeholders; points out, furthermore, that the next MFF must be implemented as close to people as possible;

    93.  Calls for genuine simplification where there are overlapping objectives, diverging eligibility criteria and different rules governing horizontal provisions that should be uniform across programmes; considers that an assessment of which spending programmes should be included in the next MFF must be based on the above aspects, on the need to focus spending on clearly identified policy objectives with clear European added value and on the policy intervention logic of each programme; stresses that reducing the number of programmes is not an end in itself;

    94.  Underlines that simplification cannot mean more leeway for the Commission without the necessary checks and balances and must therefore be achieved with full respect for the institutional balance provided for in the Treaties;

    95.  Insists that simplification cannot come at the expense of the quality of programme design and implementation and that, therefore, a simpler budget must also be a more transparent budget, enabling better accountability, scrutiny, control of spending and reducing the risks of double funding, misuse and fraud; underlines that any reduction in programmes must be offset by a far more detailed breakdown of the budget by budget line, in contrast to some programme mergers in the current MFF, such as the Neighbourhood, Development and International Cooperation Instrument – Global Europe (NDICI – Global Europe), which is an example not to follow; calls, therefore, for a sufficiently detailed breakdown by budget line to enable the budgetary authority to exercise proper accountability and ensure that decision-making in the annual budgetary procedure and in the course of budget implementation is meaningful;

    96.  Recalls that transparency is essential to retain citizens’ trust, and that fraud and misuse of funds are extremely detrimental to that trust; underlines, therefore, the need for Parliament to be able to control spending and assess whether discharge can be granted; insists that proper accountability requires robust auditing for all budgetary expenditure based on the application of a single audit trail; calls on the Commission to put in place harmonised and effective anti-fraud mechanisms across funding instruments for the post-2027 MFF that ensure the protection of the Union’s budget;

    97.  Reiterates its long-standing position that all EU-level spending should be brought within the purview of the budgetary authority, thereby ensuring transparency, democratic control and protection of the Union’s financial interests; calls, therefore, for the full budgetisation of (partially) off-budget instruments such as the Social Climate Fund, the Innovation Fund and the Modernisation Fund, or their successors;

    A long-term budget that is more flexible and more responsive to crises and shocks

    98.  Points out that, traditionally, the MFF has not been conceived with a crisis response or flexibility logic, but rather has been designed primarily to ensure medium-term investment predictability; underlines that, in a rapidly changing political, security, economic and social context, such an approach is no longer tenable; insists on sufficient in-built crisis response capacity in the next MFF;

    99.  Underscores that the current MFF has been beset by a lack of flexibility and an inability to adjust to evolving spending priorities; considers that the next MFF needs to strike a better balance between investment predictability and flexibility to adjust spending focus; highlights that spending in certain areas requires greater stability than in others where flexibility is more valuable; stresses that recurrent redeployments are not a viable way to finance the Union’s priorities as they damage investments and jeopardise the delivery of agreed policy objectives;

    100.  Believes that, while allocating a significant portion of funding to objectives up-front, spending programmes should retain a substantial in-built flexibility reserve, with allocation to specific policy objectives to be decided by the budgetary authority; notes that the NDICI – Global Europe’s emerging challenges and priorities cushion provides a model for such a flexibility reserve, but that the decision-making process for its mobilisation must not be replicated in the future MFF; points to the need for stronger, more effective scrutiny powers of the co-legislators over the setting of policy priorities and objectives and a detailed budgetary breakdown to ensure that the budgetary authority is equipped to make meaningful and informed decisions;

    101.  Underlines that the MFF must have sufficient margins under each heading to ensure that new instruments or spending objectives agreed over the programming period can be accommodated without eroding funding for other policy and long-term strategic objectives or eating into crisis response capacity;

    102.  Underlines that the possibility for budgetary transfers under the Financial Regulation already provides for flexibility to adjust to evolving spending needs in the course of budget implementation; stresses that, under the current rules, the Commission has significant freedom to transfer considerable amounts between policy areas without budgetary authority approval, which limits scrutiny and control; calls, therefore, for the rules to be changed so as to introduce a maximum amount, in addition to a maximum percentage per budget line, for transfers without approval; considers that for transfers from Union institutions other than the Commission that are subject to a possible duly justified objection by Parliament or the Council, a threshold below which they would be exempt from that procedure could be a useful measure of simplification;

    103.  Recalls that the current MFF has been placed under further strain due to high levels of inflation in a context where an annual 2 % deflator is applied to 2018 prices, reducing the budget’s real-terms value and squeezing its operational and administrative capacity; considers, therefore, that the future budget should be endowed with sufficient response capacity to enable the budget to adapt to inflationary shocks;

    104.  Calls for a root-and-branch reform of the existing special instruments to bolster crisis response capacity and ensure an effective and swift reaction through more rapid mobilisation; underlines that the current instruments are both inadequate in size and constrained by excessive rigidity, with several effectively ring-fenced according to crisis type; points out that enhanced crisis response capacity will ensure that cohesion policy funds are not called upon for that purpose and can therefore be used for their intended investment objectives;

    105.  Considers that the post-2027 MFF should include only two special instruments – one dedicated to ensuring solidarity in the event of natural disasters (the successor to the existing European Solidarity Reserve) and one for general-purpose crisis response and for responding to any unforeseen needs and emerging priorities, including where amounts in the special instrument for natural disasters are insufficient (the successor to the Flexibility Instrument); insists that both special instruments should be adequately funded from the outset and able to carry over unspent amounts indefinitely over the MFF period; believes that all other special instruments can either be wound up or subsumed into the two special instruments or into existing programmes;

    106.  Calls for the future Flexibility Instrument to be heavily front-loaded and subsequently to be fed through a number of additional sources of financing: unspent margins from previous years (as with the current Single Margin Instrument), the annual surplus from the previous year, a fines-based mechanism modelled on the existing Article 5 of the MFF Regulation, reflows from financial instruments and decommitted appropriations; underlines that the next MFF should be designed such that the future special instruments are not required to cover debt repayment;

    107.  Underlines that re-use of the surplus, of reflows from financial instruments and surplus provisioning and of decommitments would require amendments to the Financial Regulation;

    108.  Points out that, with sufficient up-front resources and such arrangements for re-using unused funds, the budget would have far greater response capacity without impinging on the predictability of national GNI-based contributions; insists that an MFF endowed with greater flexibility and response capacity is less likely to require a substantial mid-term revision;

    A long-term budget that is more results-focused

    109.  Emphasises that, in order to maximise impact, it is imperative that spending under the next MFF be much more rigorously aligned with the Union’s strategic policy aims and better coordinated with spending at national level; underlines that, in turn, consultation with regional and local authorities is vital to facilitate access to funding and ensure that Union support meets the real needs of final recipients and delivers tangible benefits for people; underscores the importance of technical assistance to implementing authorities to help ensure timely implementation, additionality of investments and therefore maximum impact;

    110.  Underlines that, in order to support effective coordination between Union and national spending, the Commission envisages a ‘new, lean steering mechanism’ designed ‘to reinforce the link between overall policy coordination and the EU budget’; insists that Parliament play a full decision-making role in any coordination or steering mechanism;

    111.  Considers that the RRF, with its focus on performance and links between reforms and investments and budgetary support, has helped to drive national investments and reforms that would not otherwise have taken place;

    112.  Underlines that the RRF can help to inform the delivery of Union spending under shared management; recalls, however, that the RRF was agreed in the very specific context of the COVID-19 pandemic and cannot, therefore, be replicated wholesale for future investment programmes;

    113.  Points out that spending under shared management in the next MFF must involve regional and local authorities and all relevant stakeholders from design to delivery through a place-based and multilevel governance approach and in line with an improved partnership principle, ensure the cross-border European dimension of investment projects, and focus on results and impact rather than outputs by setting measurable performance indicators, ensuring availability of relevant data and feeding into programme design and adjustment;

    114.  Underlines that the design of shared management spending under the next MFF must safeguard Parliament’s role as legislator, budgetary and discharge authority and in holding the executive to account, putting in place strict accountability mechanisms and guaranteeing full transparency in relation to final recipients or groups of recipients of Union spending funds through an interoperable system enabling effective tracking of cash flows and project progress;

    115.  Considers that the ‘one national plan per Member State’ approach envisaged by the Commission is not in line with the principles set out above and cannot be the basis for shared management spending post-2027; recalls that, in this regard, the Union is required, under Article 175 TFEU, to provide support through instruments for agricultural, regional and social spending;

    A long-term budget that manages liabilities sustainably

    116.  Recalls Parliament’s very firm opposition to subjecting the repayment of NGEU borrowing costs to a cap within an MFF heading given that these costs are subject to market conditions, influenced by external factors and thus inherently volatile, and that the repayment of borrowing costs is a non-discretionary legal obligation; stresses that introducing new own resources is also necessary to prevent future generations from bearing the burden of past debts;

    117.  Deplores the fact that, under the existing architecture and despite the joint declaration by the three institutions as part of the 2020 MFF agreement whereby expenditure to cover NGEU financing costs ‘shall aim at not reducing programmes and funds’, financing for key Union programmes and resources available for special instruments, even after the MFF revision, have de facto been competing with the repayment of NGEU borrowing costs in a context of steep inflation and rising interest rates; recalls that pressure on the budget driven by NGEU borrowing costs was a key factor in cuts to flagship programmes in the MFF revision;

    118.  Underlines that, to date, the Union budget has been required only to repay interest related to NGEU and that, from 2028 onwards, the budget will also have to repay the capital; underscores that, according to the Commission, the total costs for NGEU capital and interest repayments are projected to be around EUR 25-30 billion a year from 2028, equivalent to 15-20 % of payment appropriations in the 2025 budget;

    119.  Acknowledges that, while NGEU borrowing costs will be more stable in the next MFF period as bonds will already have been issued, the precise repayment profile will have an impact on the level of interest and thus on the degree of volatility; insists, therefore, that all costs related to borrowing backed by the Union budget or the budgetary headroom be treated distinctly from appropriations for EU programmes within the MFF architecture;

    120.  Points, in that regard, to the increasing demand for the Union budget to serve as a guarantee for the Union’s vital support through macro-financial assistance and the associated risks; underlines that, in the event of default or the withdrawal of national guarantees, the Union budget ultimately underwrites all macro-financial assistance loans and therefore bears significant and inherently unpredictable contingent liabilities, notably in relation to Ukraine;

    121.  Calls, therefore, on the Commission to design a sound and durable architecture that enables sustainable management of all non-discretionary costs and liabilities, fully preserving Union programmes and the budget’s flexibility and response capacity;

    A long-term budget that is properly resourced and sustainably financed

    122.  Underlines that, as described above, the budgetary needs post-2027 will be significantly higher than the amounts allocated to the 2021-2027 MFF and, in addition, will need to cover borrowing costs and debt repayment; insists, therefore, that the next MFF be endowed with significantly increased resources compared to the 2021-2027 period, moving away from the historically restrictive, self-imposed level of 1 % of GNI, which has prevented the Union from delivering on its ambitions and deprived it of the ability to respond to crises and adapt to emerging needs;

    123.  Considers that all instruments and tools should be explored in order to provide the Union with those resources, in line with its priorities and identified needs; considers, in this respect, that joint borrowing through the issuance of EU bonds presents a viable option to ensure that the Union has sufficient resources to respond to acute Union-wide crises such as the ongoing crisis in the area of security and defence;

    124.  Reiterates the need for sustainable and resilient revenue for the Union budget; points to the legally binding roadmap towards the introduction of new own resources in the IIA, in which Parliament, the Council and the Commission undertook to introduce sufficient new own resources to at least cover the repayment of NGEU debt; underlines that, overall, the basket of new own resources should be fair, linked to broader Union policy aims and agreed on time and with sufficient volume to meet the heightened budgetary needs;

    125.  Recalls its support for the amended Commission proposal on the system of own resources; is deeply concerned by the complete absence of progress on the system of own resources in the Council; calls on the Council to adopt this proposal as a matter of urgency; and urges the Commission to spare no effort in supporting the adoption process;

    126.  Calls furthermore, on the Commission to continue efforts to identify additional innovative and genuine new own resources and other revenue sources beyond those specified in the IIA; stresses that new own resources are essential not only to enable repayment of NGEU borrowing, but to ensure that the Union is equipped to cover its the higher spending needs;

    127.  Calls on the Commission to design a modernised budget with a renewed spending focus, driven by the need for fairness, greater simplification, a reduced administrative burden and more transparency, including on the revenue side; underlines that existing rebates and corrections automatically expire at the end of the current MFF;

    128.  Welcomes the decision, in the recast of the Financial Regulation, to treat as negative revenue any interest or other charge due to a third party relating to amounts of fines, other penalties or sanctions that are cancelled or reduced by the Court of Justice; recalls that this solution comes to an end on 31 December 2027; invites the Commission to propose a definitive solution for the next MFF that achieves the same objective of avoiding any impact on the expenditure side of the budget;

    A long-term budget grounded in close interinstitutional cooperation

    129.  Underlines that Parliament intends to fully exercise its prerogatives as legislator, budgetary authority and discharge authority under the Treaties;

    130.  Recalls that the requirement for close interinstitutional cooperation between the Commission, the Council and Parliament from the early design stages to the final adoption of the MFF is enshrined in the Treaties and further detailed in the IIA;

    131.  Emphasises Parliament’s commitment to play its role fully throughout the process; believes that the design of the MFF should be bottom-up and based on the extensive involvement of stakeholders; underlines, furthermore, the need for a strategic dialogue among the three institutions in the run-up to the MFF proposals;

    132.  Calls on the Commission to put forward practical arrangements for cooperation and genuine negotiations from the outset; points, in particular, to the importance of convening meetings of the three Presidents, as per Article 324 TFEU, wherever they can aid progress, and insists that the Commission follow up when Parliament requests such meetings; reminds the Commission of its obligation to provide information to Parliament on an equal footing with the Council as the two arms of the budgetary authority and as co-legislators on MFF-related basic acts;

    133.  Recalls that the IIA specifically provides for Parliament, the Council and the Commission to ‘seek to determine specific arrangements for cooperation and dialogue’; stresses that the cooperation provisions set out in the IIA, including regular meetings between Parliament and the Council, are a bare minimum and that much more is needed to give effect to the principle in Article 312(5) TFEU of taking ‘any measure necessary to facilitate the adoption of a new MFF’; calls, therefore, on the successive Council presidencies to respect not only the letter, but also the spirit of the Treaties;

    134.  Recalls that the late adoption of the MFF regulation and related legislation for the 2014-2020 and 2021-2027 periods led to significant delays, which hindered the proper implementation of EU programmes; insists, therefore, that every effort be made to ensure timely adoption of the upcoming MFF package;

    135.  Expects the Commission, as part of the package of MFF proposals, to put forward a new IIA in line with the realities of the new budget, including with respect to the management of contingent liabilities; stresses that the changes to the Financial Regulation necessary for alignment with the new MFF should enter into force at the same time as the MFF Regulation;

    o
    o   o

    136.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 433I, 22.12.2020, p. 11, ELI: http://data.europa.eu/eli/reg/2020/2093/oj.
    (2) OJ L 424, 15.12.2020, p. 1, ELI: http://data.europa.eu/eli/dec/2020/2053/oj.
    (3) OJ L 433I, 22.12.2020, p. 28, ELI: http://data.europa.eu/eli/agree_interinstit/2020/1222/oj.
    (4) OJ L 2024/2509, 26.9.2024, p. 1, ELI: http://data.europa.eu/eli/reg/2024/2509/oj.
    (5) OJ L 433I, 22.12.2020, p. 1, ELI: http://data.europa.eu/eli/reg/2020/2092/oj.
    (6) OJ C, C/2024/6751, 26.11.2024, ELI: http://data.europa.eu/eli/C/2024/6751/oj.
    (7) OJ C, C/2023/1067, 15.12.2023, ELI: http://data.europa.eu/eli/C/2023/1067/oj.
    (8) OJ C 177, 17.5.2023, p. 115.
    (9) OJ C 445, 29.10.2021, p. 240.
    (10) OJ C 428, 13.12.2017, p. 10.
    (11) OJ C, C/2025/279, 24.1.2025, ELI: http://data.europa.eu/eli/C/2025/279/oj.
    (12) Article 9 of Regulation (EU) 2020/852 of the European Parliament and of the Council of 18 June 2020 on the establishment of a framework to facilitate sustainable investment, and amending Regulation (EU) 2019/2088 (OJ L 198, 22.6.2020, p. 13, ELI: http://data.europa.eu/eli/reg/2020/852/oj).
    (13) Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (OJ L 277, 27.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2065/oj).
    (14) Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ L 265, 12.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/1925/oj).

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – Competition policy – annual report 2024 – P10_TA(2025)0104 – Thursday, 8 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Treaty on the Functioning of the European Union (TFEU), in particular to Articles 101 to 109 thereof,

    –  having regard to the publication of 18 July 2024 by Ursula von der Leyen entitled ‘Europe’s choice – political guidelines for the next European Commission 2024–2029’,

    –  having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’,

    –  having regard to the report of 18 April 2024 by Enrico Letta entitled ‘Much more than a market’,

    –  having regard to the European Court of Auditors Special Report21/2024 of 23 October 2024 entitled ‘State aid in times of crisis – Swift reaction but shortcomings in the Commission’s monitoring and inconsistencies in the framework to support the EU’s industrial policy objectives’,

    –  having regard to Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (the EC Merger Regulation)(1),

    –   having regard to Article 11 TFEU, which mandates the integration of environmental protection requirements into the definition and implementation of all EU policies and activities, with a view to promoting sustainable development,

    –  having regard to Article 3 of Decision (EU) 2022/591 of the European Parliament and of the Council of 6 April 2022 on a General Union Environment Action Programme to 2030(2), which provides that environmentally harmful subsidies, in particular fossil fuel subsidies, should be phased out without delay,

    –  having regard to the judgments of the Court of Justice of the European Union of 3 September 2024 in Case C‑611/22 P, Illumina v Commission(3), of 10 September 2024 in Case C‑465/20 P, European Commission v Ireland and Others(4), and of 10 September 2024 in Case C‑48/22 P (Google and Alphabet v Commission)(5),

    –  having regard to the Commission’s report of June 2024 entitled ‘Protecting competition in a changing world – Evidence on the evolution of competition in the EU during the past 25 years’,

    –  having regard to the study entitled ‘The role of commodity traders in shaping agricultural markets’, published by its Policy Department for Structural and Cohesion Policies in November 2024,

    –  having regard to the report of 20 December 2023 by the European Securities and Markets Authority entitled ‘CRA Market Share Report: 2023 edition’,

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Economic and Monetary Affairs (A10-0071/2025),

    A.  whereas the current challenging economic, climate and geopolitical contexts, marked by uncertainty and unpredictability, require a renewed approach to European competitiveness and concrete strategies to boost economic growth;

    B.  whereas the proper enforcement of the EU competition policy framework leads to lower prices, higher quality, greater choice for consumers, faster innovation and a fairer and more resilient economy, and protects entry conditions for operators in the internal market, tackling abuses of dominant position, monopolies and practices distortive to the internal market;

    C.  whereas the Draghi report underlines that the EU has a broad and diversified industrial innovation base, with a strong comparative advantage in green technologies, but that sustained efforts are needed in order to retain that advantage; whereas the integration of climate and environmental considerations into competition policy is essential, in that regard; whereas the Letta report maintains that the lack of EU integration in the financial, energy and electronic communications sectors is a primary reason for Europe’s declining competitiveness;

    D.  whereas the EU’s competition policy could contribute to bolstering the resilience of the internal market, as well as achieving the goals of the European Green Deal, the 2030 Digital Compass and the Competitiveness Compass, for which international exchange and cooperation are essential;

    E.  whereas the Commission and the national competition authorities need to act in an impartial and objective way in order to preserve the credibility of the EU’s competition policy; whereas the political independence of national competition authorities is of utmost importance to ensure the impartiality and credibility of competition policy;

    General considerations

    1.  Considers that EU competition law seeks to shield against excessive levels of concentration and accumulation of market power, and reaffirms the role of competition policy in encouraging efficiency, innovation and growth, creating a level playing field and protecting consumers, by assuring that markets remain competitive, efficient, dynamic and innovative, delivering high-quality products and services at fair prices and with a wider range of choice;

    2.  Reiterates that competition policy should contribute to all of the EU’s policies, notably in the fields of sustainability, energy, defence and digitalisation; welcomes the Commission’s commitment to a new State aid framework to accompany the Clean Industrial Deal, so as to ensure competitiveness through mobilising the necessary public support for the energy transition to decarbonise EU industry, while ensuring that this does not hinder innovation, increase prices or reduce competition in the internal market; reiterates that State aid should not distort fair and effective competition;

    3.  Emphasises that the global strength and importance of the EU single market derives not only from its internal and external competitiveness but also from its ability to set common standards and guarantee territorial cohesion; notes that at the same time, policymakers should take due account of international regulatory and market developments and calls on the Commission to strive for continued dialogue and cooperation at international level, including via second-generation cooperation agreements that allow for more effective information exchange between competition authorities, and the development of influence on competition policy, globally; highlights the importance of the European Competition Network (ECN) and calls on the Commission to prioritise sustained constructive dialogue and cooperation, in this regard, at international level; calls for the coordination between national competition authorities to ensure the uniform application of competition rules and underlines the necessity of increasing collaboration between antitrust and other sectoral regulators;

    A competitive Union

    4.  Supports the Commission’s commitment to investing in sustainable competitiveness; welcomes the Draghi report’s emphasis on innovation, investments, market integration, decarbonisation and resilience, and the Letta report’s focus on integration, autonomy and solidarity; encourages policies that promote innovation, competitiveness and sustainable and inclusive growth;

    5.  Underlines the need for coordinated, targeted and truly European industrial policy to boost competitiveness; notes that this must not result in market dominance or abuse thereof, price distortion or economic inefficiencies, and points to the need for effective merger control procedures;

    6.  Considers that any State aid granted should be consistent with EU policy objectives; notes the Commission’s intention to provide guidance on the compatibility of State aid with innovation, climate and economic security considerations, as well as its actions to scale down and phase out fossil fuel subsidies under the Clean Industrial Deal, and encourages the Member States to consider the introduction of further conditions for the receipt of State aid; calls for companies structured through non-EU tax havens to be barred from receiving State aid; invites the Commission to investigate the lack of harmonisation of clawback mechanisms;

    7.  Takes note of the Commission’s report asserting that market concentration, markups and profits have increased over the past 25 years, while industry dynamism has decreased, despite the active enforcement of competition law; also takes note that this increase in markups was found to be driven by market share reallocation towards the largest firms; further notes that weak levels of competition have had significant negative impacts on consumers, purchasing power, and on the competitiveness of EU firms and overall economic growth; recalls that the application of competition law should focus on ensuring open, competitive markets free from anti-competitive practices;

    8.  Points out that State aid is increasingly used to support industrial policy objectives; recalls that such aid, as permitted under Article 107(3)(c) TFEU, must not adversely affect trading conditions or the common interest; notes the divergent fiscal capabilities of the Member States and warns that fragmented State aid creates an uneven playing field; calls on the Commission to monitor these effects and to ensure the integrity of the single market, which can be done through a common financing instrument for a European industrial policy, such as a European Competitiveness Fund, as proposed by Commission President von der Leyen in her political guidelines; calls on the Commission and the Member States not to engage in subsidy competition, which only exacerbates market distortions, notably when financing undertakings that are not efficient; concludes that temporary State aid frameworks have failed to prevent further market fragmentation and notes that only two of the Member States accounted for 77 % of State aid notified; calls for stricter State aid notification monitoring and enhanced State aid reporting and transparency, in line with the recommendations of the European Court of Auditors;

    9.   Underlines the importance of the important projects of common European interest (IPCEIs) for financing projects within the EU with a cross-border dimension; stresses that IPCEIs should have genuine EU added value, which means that they should have a positive impact on more than one Member State; calls on the Commission and the Member States to ensure that any such State aid notification is completed within six months at the latest;

    10.  Takes note of the Draghi report’s estimate that, in order to protect our EU competitiveness, an additional EUR 800 billion per year is needed; acknowledges the importance of public and private investment in this context; underlines that the EU budget needs to be properly equipped to that end; regards the completion of the Savings and Investments Union as important for mobilising private investment, addressing the fragmentation of the internal market and supporting the EU’s industrial strategy; acknowledges the urgent need for reforms alongside the effective implementation of the three action areas outlined in the Draghi report: (i) closing the innovation gap with the US and China; (ii) a common plan for decarbonisation and competitiveness to accelerate the energy transition and reduce energy costs; and (iii) enhancing security and reducing dependencies;

    11.  Welcomes the protection of the level playing field of European markets and European companies and their workers granted by anti-dumping measures that correct for distortive foreign State aid; calls on the Commission to make swift use of available trade instruments on procurement and foreign subsidies to prevent unfair competition in the internal market;

    Enforcement priorities

    12.  Observes changes in business practices, highlighting a decline in cartel cases; cautions, however, against new forms of harmful conduct like tacit collusion and algorithmic collusion, and emphasises the need to align enforcement priorities with this evolving landscape;

    13.  Notes the Draghi report’s proposal for a ‘new competition tool’ as a flexible market investigation tool designed to address structural competition problems that do not result from anti-competitive agreements or abuse of dominance, and to impose market-wide, forward-looking structural or behavioural remedies, including by lowering entry barriers for competitors, with the aim of increasing competitiveness, incentivising innovation and protecting vulnerable consumers; invites the Commission to analyse how this tool would complement the existing framework for sector investigations;

    14.  Recalls that under the Treaty, the Commission is empowered to address exploitative abuses;

    15.  Acknowledges the existence of a legal base for structural remedies against the abuse of market dominance; is aware that EU competition rules stipulate that structural remedies should only be used as a last resort if behavioural remedies have proven ineffective, but nonetheless regrets the reluctance of the Commission to address market dominance through structural remedies; reiterates its invitation to make better use of structural remedies and end the primacy given to behavioural remedies, and encourages further efforts to strengthen their application when necessary; calls on the Commission to make better use of the interim measures instrument to stop any practice that would seriously harm competition, particularly in relation to dynamic and rapidly developing markets such as digital markets;

    16.  Welcomes the priority given to housing by the 2024-2029 Commission; calls on the Commission to assess how EU competition principles affect the supply of services of general economic interest (SGEI); calls on the Commission to assess the position of social services of general interest and an SGEI exemption for affordable housing;

    17.  Stresses the importance of State aid as a tool for closing the economic gap between more developed EU regions and island areas, inland areas, outermost regions and economically depressed areas; recalls that allowing State aid in the context of SGEIs remains essential for the survival of these areas, especially in the context of State support dedicated to connectivity and other basic provisions of services for communities residing in isolated, remote or peripheral regions of the EU; calls on the Commission to investigate possibilities of further flexibility in providing funding to these regions;

    18.  Takes note of the recent Court of Justice of the European Union ruling which found that one of the Member States has failed to transpose the ECN+ Directive into national legislation; underlines the importance of transposing the ECN+ Directive fully; calls on all of the Member States to ensure a proper implementation of this Directive;

    Merger and antitrust

    19.  Notes with concern the Court of Justice of the European Union’s interpretation of Article 22 of the EC Merger Regulation in Case C-611/22 P (Illumina v Commission), rescinding the Commission’s approach of accepting referrals of non-notifiable deals; acknowledges that the EC Merger Regulation does not provide the Commission with sufficient tools for dealing with killer acquisitions; strongly believes that the impact of merger decisions on the internal market justifies the inclusion of an internal market legal base in the EC Merger Regulation, so as to fully involve co-legislators, in a manner similar to that of the Digital Markets Act (DMA); calls on the Commission to require Member States that have or can claim the relevant competence to examine potential killer acquisitions in the light of their national merger control laws, and to continue to refer those deals in accordance with Article 22 of the EC Merger Regulation; calls on the Commission to explore the possibility of reviewing the EC Merger Regulation to be able to examine mergers that fall below EU or national thresholds, regardless of the sectors involved;

    20.  Notes that since the 2004 entry into force of the EC Merger Regulation, 0,7 % of notified mergers have been either blocked by the Commission or withdrawn following an investigation;

    21.  Notes that the turnover thresholds in the EC Merger Regulation alone might not be suitable for detecting all cases that should be reviewed by the competition authorities; highlights practices used by dominant firms to avoid formal investigations, such as the growing use of ‘partnerships’ in the AI sector, which further suggests that a review of the EU Merger Regulation is necessary;

    22.  Welcomes the Draghi report’s proposal for an ‘innovation defence’ in cases where a merger increases the ability and incentive to innovate, and invites the Commission to analyse and further develop this concept; furthermore calls for matters of public interest, such as the impact on workers, to be taken into account;

    23.  Asks the Commission to identify the national barriers that may prevent it from considering the EU market as the relevant one in its analyses of mergers; calls on the Commission to present a legislative proposal to remove these impediments; notes that the international environment needs to be carefully analysed when deciding on the definition of the relevant market in competition and merger control cases; calls on the Commission to adopt a forward-looking approach to consolidation in the EU where appropriate, as also proposed by the Draghi and Letta reports, taking into account the strategic importance and pro-competitive impact of scale and favourable investment conditions in certain sectors for driving innovation and long-term competition;

    24.  Calls for merger assessment frameworks to be updated to reflect the realities of the digital economy, where market power can be manifested in ways beyond traditional market share in clearly delineated markets; supports the development of advanced methodologies for analysing data-driven dominance and network effects, emphasising the critical role of consumer choice in selecting digital services and devices; encourages the Commission to enhance mechanisms enabling interoperability across services and devices, fostering innovation and competition in the digital ecosystem; urges the Commission to progress swiftly on the implementation of the existing interoperability obligations for messaging services under the DMA, the existing interoperability obligations for cloud providers under the Data Act and to start work on the review of the DMA for May 2026; urges the Commission to implement existing interoperability obligations under the DMA and look into extending interoperability obligations to online social networking services; supports the Commission in taking more account of the potential harm to competition when assessing mergers where expansion into adjacent markets would have the effect of further strengthening market dominance in the acquiring company’s core market;

    25.  Calls on the Commission to address excessively long antitrust investigations during which companies continue to benefit from their anticompetitive practices; calls on the Commission to set appropriate time limits for antitrust cases and ensure an effective follow-through of decisions taken; calls on the Commission to adopt further interim measures to stop any practice which would seriously harm competition, particularly in relation to dynamic and rapidly developing markets such as digital markets;

    Sectoral policies

    26.  Welcomes the two September 2024 landmark judgments by the Court of Justice confirming the Commission’s assertion that the Irish tax deal with Apple constitutes illegal State aid and that Google abused its dominant position in contravention of the Treaties; acknowledges that the legal framework in Ireland has since changed; encourages the Commission to continue the clamp down on State aid abuses involving the selective granting of tax breaks to companies;

    27.  Notes the detrimental effect of international tax competition; recalls its support for the implementation of Pillar Two of the Organisation for Economic Co-operation and Development (OECD); deeply regrets the US presidential Executive Order of 20 January 2025 which asserts that the OECD global tax agreement has ‘no force or effect within the United States’; stresses the importance of multilateralism in ensuring that multinationals pay their fair share of taxation where value is created; takes the view that the EU should fully stand by the OECD’s Pillar Two Directive;

    28.  Emphasises the worrying market concentrations in various digital markets, such as social media, search engines, AI, cloud services, e-commerce, microchips and online advertising; underlines the actual and potential negative impact on EU competitiveness, the resilience of supply chains, media freedom, privacy and data protection, society and democracy; urges the Commission to address issues that are specific to the tech market, including infrastructural power in hardware and cloud computing layers, vertical concentration, algorithmic manipulation of the digital public sphere and market leveraging in digital markets, as demonstrated by the progress made under the DMA; additionally calls for the opening of new investigations into the cloud services sector to further ensure fair competition and innovation, taking into account the degree of market concentration in this sector and anticompetitive practices related to complex and non-transparent licensing terms or forced bundling; furthermore, urges the Commission to address the increasing vertical concentration of dominant players across the advertising value chain, which puts the EU online advertising sector at risk;

    29.  Notes the rapid development of AI services, which has the potential to result in market concentration; calls on the Commission to take an ecosystemic approach towards this sector, including by developing and applying new theories of harm to address the further entrenchment of the dominant players in this sector; highlights that the DMA contains several provisions that must be used to prevent gatekeepers from restricting emerging AI developers, and asks the Commission to act swiftly to address the risk of consumers being forced into using pre-determined AI services on their mobile devices, ensuring that AI systems remain user-selectable and transparent, thereby safeguarding competition and consumer choice; calls on the Commission to explore the possibility of adding generative AI as a new core platform service under the DMA;

    30.  Notes that large digital players use their market power, power over consumers, financial resources and data concentration in one market to leverage their position in another; stresses that small players cannot compete with the aforementioned factors, which makes EU citizens even more dependent on the same small number of non-EU companies and endangers strategic autonomy; calls for increased scrutiny of the leveraging of position by dominant digital sector players into other sectors and the EU’s strategic autonomy, through a revision of the merger guidelines to ensure that market leveraging can be scrutinised more effectively;

    31.  Notes the importance of data and data analytics tools as one of the deterring factors for digital market concentrations and acquisitions in the digital sector; calls for an opinion of the European Data Protection Board in cases of concentrations involving one or more operators in digital sectors on the relevance of datasets for the intended concentration, the personal data the target acquisition processes and the potential impact on the rights to privacy and data protection the intended concentration has;

    32.  Expresses concern regarding the growing use of dynamic pricing mechanisms across the EU; calls on the Commission to explore regulatory measures against highly adaptive and opaque pricing methods;

    33.  Calls on the Commission to vigorously enforce all competition rules, including the Foreign Subsidies Regulation and the DMA, in order to address gatekeeper practices and foster contestable markets and fair competition; stresses that the Commission must have sufficient staff for enforcement, while noting that new tools, as well as scientists and economists stemming from divergent disciplines, can work to improve competition law enforcement; underlines in particular that the DMA should be applied rigorously and independently, without any undermining by external pressures; stresses that the DMA and potential fines must not be used as a bargaining chip in relation to discussions on tariffs, but as a cornerstone of the EU’s efforts to ensure fair and competitive digital markets; notes the six non-compliance procedures launched against some designated gatekeepers; is deeply concerned about potential delays in critical investigations and the capacity of the Commission to respect their ‘best effort’ obligations and to make a decision on non-compliance procedures without undue delay;

    34.  Notes with concern the fragmentation in numerous consumer markets, including financial services, telecoms and household energy, and calls for faster and greater market integration where there are benefits for consumers, and for recognition that this market integration can drive investment and innovation;

    35.  Expresses alarm at the high concentration in the retail, agricultural and automotive sectors in overseas territories whereby excessive prices set by dominant undertakings on essential products and services amplify inequalities, precariousness and territorial disparities; calls on the Commission to launch an investigation into potential abuses of dominant position under Article 102 TFEU;

    36.  Notes with concern the high degree of market concentration in the European financial sector, as well as its sustained over-reliance on a limited number of non-EU service providers; notes that the three largest credit rating agencies still hold a market share of over 90 %; expresses concern about the continued high concentration in the public interest entities (PIE) audit market, with four firms mainly holding the vast majority of EU revenues for PIE audits, limiting choice and risking supervisory capture; invites the Commission to present an impact assessment on options to address these concerns; urges the Commission to carefully assess public tenders for expertise from audit market participants so that potential conflicts of interest are avoided;

    37.  Expresses concern about the food price crisis and notes, in this regard, the high levels of market concentration in food supply chains; reiterates its call for the Commission to urgently conduct a thorough analysis of the extent and effect of buying alliances, thereby devoting special attention to guaranteeing fair competition and greater transparency in supermarket and hypermarket chains’ commercial practices, particularly where such practices affect brand value and product choice or limit innovation or price comparability; recalls, in this light, the market concentration in agri-commodity trading wherein four companies account for the vast majority of the global crop trade; regrets that the Commission nonetheless conditionally approved the 2024 Bunge-Viterra merger (M.11204) despite competition concerns; asks the Commission to address excessive power accumulation in the hands of a few large players in this market, in order to strengthen the bargaining position of farmers and consumers alike; highlights the implementation of the New Competition Tool in this context;

    38.  Notes the high-net profits of EU banks during this inflationary period, mostly driven by the delayed pass-through of the rapid monetary policy tightening to deposit rates;

    39.  Notes with particular concern the dominant position of two international card schemes in the EU payments market, and their engagement in practices that reinforce and extend their dominance of this market, potentially further increasing barriers to entry and hampering long-term innovation(6), as well as leading to higher costs for EU businesses and ultimately consumers; calls on the Commission to take decisive actions, emphasising the need for a review of the Interchange Fee Regulation (Regulation (EU) 2015/751) to tackle the significant increase in card scheme fees charged by international card schemes and to ensure a fair, competitive and transparent market environment;

    Parliamentary involvement

    40.  Stresses that Parliament should be sufficiently involved in shaping competition policy; cautions against the over-reliance on soft-law instruments, such as guidance and temporary frameworks, in which Parliament’s involvement is limited; calls on the Commission to enter into negotiation for an interinstitutional agreement on competition policy to formalise its enforcement priorities to Parliament; calls on the European Council to adopt a decision under Article 48(7) TEU allowing for the adoption of legislative acts in the area of competition policy in accordance with the ordinary legislative procedure; stresses that Parliament should be more involved in the activity of working parties and expert groups in the International Competition Network and the OECD as an observer, and also in the High-Level Group on the DMA;

    41.  Calls on the responsible Executive Vice-President, also Commissioner in charge of competition policy to maintain close contact with Parliament’s competent committee and its working group on competition issues;

    o
    o   o

    42.  Instructs its President to forward this resolution to the Council and the Commission.

    (1) OJ L 024, 29.1.2004, p. 1, ELI: http://data.europa.eu/eli/reg/2004/139/oj.
    (2) OJ L 114, 12.4.2022, p. 22, ELI: http://data.europa.eu/eli/dec/2022/591/oj.
    (3) Judgment of the Court of Justice of 3 September 2024, Illumina v Commission, C-611/22 P, ECLI:EU:C:2024:677.
    (4) Judgment of the Court of Justice of 10 September 2024, European Commission v Ireland and Others, C-465/20 P, ECLI:EU:C:2024:724.
    (5) Judgment of the Court of Justice of 10 September 2024, Google and Alphabet v Commission, C-48/22 P, CLI:EU:C:2024:726.
    (6) European Court of Auditors, Special Report: ‘Digital payments in the EU – Progress towards making them safer, faster, and less expensive, despite remaining gaps’, 9 January 2025, https://www.eca.europa.eu/ECAPublications/SR-2025-01/SR-2025-01_EN.pdf.

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – 2023 and 2024 reports on Kosovo – P10_TA(2025)0094 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Stabilisation and Association Agreement between the European Union and the European Atomic Energy Community, of the one part, and Kosovo, of the other part(1), which entered into force on 1 April 2016,

    –  having regard to Kosovo’s application for membership of the European Union of 15 December 2022,

    –  having regard to Kosovo’s application for membership of the Council of Europe of 12 May 2022,

    –  having regard to the framework agreement between the European Union and Kosovo on the general principles for the participation of Kosovo in Union programmes(2), in force since 1 August 2017,

    –  having regard to Regulation (EU) 2021/1529 of the European Parliament and of the Council of 15 September 2021 establishing the Instrument for Pre-Accession assistance (IPA III)(3),

    –  having regard to Regulation (EU) 2024/1449 of the European Parliament and of the Council of 14 May 2024 on establishing the Reform and Growth Facility for the Western Balkans(4),

    –  having regard to the Presidency conclusions of the Thessaloniki European Council meeting of 19 and 20 June 2003,

    –  having regard to the declarations of the EU-Western Balkans Summits of 17 May 2018 in Sofia, of 6 May 2020 in Zagreb, of 6 October 2021 in Brdo pri Kranju, of 6 December 2022 in Tirana, of 13 December 2023 in Brussels, and of 18 December 2024 in Brussels,

    –  having regard to the Berlin Process launched on 28 August 2014,

    –  having regard to the Commission communication of 5 February 2020 entitled ‘Enhancing the accession process – A credible EU perspective for the Western Balkans’ (COM(2020)0057),

    –  having regard to the Commission communication of 6 October2020 entitled ‘An Economic and Investment Plan for the Western Balkans’ (COM(2020)0641),

    –  having regard to the Commission communication of 8 November 2023 entitled ‘2023 Communication on EU Enlargement Policy’ (COM(2023)0690), accompanied by the Commission staff working document entitled ‘Kosovo 2023 Report’ (SWD(2023)0692),

    –  having regard to the Commission communication of 8 November 2023 entitled ‘New growth plan for the Western Balkans’ (COM(2023)0691),

    –  having regard to the Commission communication of 20 March 2024 on pre-enlargement reforms and policy reviews (COM(2024)0146),

    –  having regard to the Commission communication of 30 October 2024 entitled ‘2024 Communication on EU enlargement policy’ (COM(2024)0690), accompanied by the Commission staff working document entitled ‘Kosovo 2024 Report’ (SWD(2024)0692),

    –  having regard to the general summary and the country assessments by the Commission, dated 31 May 2023 and 13 June 2024, on Kosovo’s economic reform programme,

    –  having regard to the joint conclusions of the Economic and Financial Dialogue between the EU and the Western Balkans and Türkiye, adopted by the Council on 16 May 2023 and to the joint conclusions of the Economic and Financial Dialogue between the EU and the Western Balkans Partners, Türkiye, Georgia, Republic of Moldova and Ukraine, adopted by the Council on 14 May 2024,

    –  having regard to UN Security Council Resolution 1244 of 10 June 1999, to the International Court of Justice (ICJ) advisory opinion of 22 July 2010 on the accordance with international law of the unilateral declaration of independence in respect of Kosovo, and to UN General Assembly Resolution 64/298 of 9 September 2010, which acknowledged the content of the ICJ opinion and welcomed the EU’s readiness to facilitate dialogue between Serbia and Kosovo,

    –  having regard to the first agreement on principles governing the normalisation of relations between Serbia and Kosovo of 19 April 2013, to the agreements of 25 August 2015, and to the ongoing EU-facilitated dialogue for the normalisation of relations,

    –  having regard to the Brussels Agreement of 27 February 2023 and the Ohrid Agreement of 18 March 2023 and to the implementation annex thereto,

    –  having regard to Council Decision (CFSP) 2023/1095 of 5 June 2023 amending Joint Action 2008/124/CFSP on the European Union Rule of Law Mission in Kosovo (EULEX Kosovo)(5), which extended the mission’s mandate until 14 June 2025,

    –  having regard to Regulation (EU) 2023/850 of the European Parliament and of the Council of 19 April 2023 amending Regulation (EU) 2018/1806 listing the third countries whose nationals must be in possession of visas when crossing the external borders and those whose nationals are exempt from that requirement (Kosovo)(6),

    –  having regard to the final report of the European Union Election Observation Mission on the 2021 municipal elections in Kosovo,

    –  having regard to the preliminary report of the European Union Election Observation Mission on the 2025 parliamentary elections in Kosovo,

    –  having regard to the fourth meeting of the Stabilisation and Association Council between the European Union and Kosovo held in Brussels on 7 December 2021,

    –  having regard to its previous resolutions on Kosovo,

    –  having regard to the joint recommendations adopted at the 12th meeting of the EU-Kosovo Stabilisation and Association Parliamentary Committee, held on 9 December 2024,

    –  having regard to the 2024 Corruption Perceptions Index by Transparency International,

    –  having regard to the 2024 World Press Freedom Index by Reporters Without Borders,

    –  having regard to the Democracy Report 2024 of March 2024 by the Varieties of Democracy (V-Dem) Institute,

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Foreign Affairs (A10-0075/2025),

    A.  whereas enlargement policy is one of the most effective EU foreign policy instruments and one of the most successful policies to incentivise and encourage fundamental reforms, and is a strategic geopolitical investment in long-term peace, stability and security throughout the continent;

    B.  whereas democracy, human rights and the rule of law are the fundamental values on which the EU is founded;

    C.  whereas the EU enlargement process is a strategic tool for strengthening stability, democracy and economic development in Europe, and each enlargement country is judged on its own merits and whereas it is the implementation of the necessary reforms and compliance with the set of criteria and common European values that determines the timetable and progress of accession; whereas Kosovo’s path towards EU membership also depends on the normalisation of relations with Serbia;

    D.  whereas the EU is the largest provider of financial support to Kosovo;

    E.  whereas Kosovo has been subjected to foreign interference and disinformation campaigns, particularly from Russia, especially through Serbian nationalist outlets, and China, through soft power, aiming to destabilise its democratic institutions, jeopardise societal cohesion, and incite ethnic violence; whereas the Banjska/Banjskë attack in September 2023 was followed by a massive spread of disinformation that further exacerbated tensions; whereas Kosovo authorities adopted the Law on the Independent Media Commission (IMC) in July 2024; whereas, in May 2024, the Council of Europe published a legal opinion on the draft law on the IMC expressing concerns related to certain aspects of the at-that-time draft law, and providing recommendations on how to address these concerns; whereas the final text of the Law on the IMC did not reflect most of the recommendations made;

    F.  whereas the European Union Rule of Law Mission in Kosovo, also known as EULEX, is the largest civilian mission ever launched under the common security and defence policy of the European Union;

    G.  whereas in 2018 and 2023, petitions were signed by over 500 people who historically self-identify as Bulgarian;

    Commitment to EU accession

    1.  Commends Kosovo’s commitment to EU accession, which reflects a clear strategic geopolitical choice, and the continued strong support of its citizens for Kosovo’s European path; reiterates that Kosovo has been consistent in its efforts to integrate into the European Union;

    2.  Reiterates its firm belief that Kosovo’s future lies in the EU and that all efforts to bring Kosovo out of the ‘grey zone’ are in the interest of the people of both Kosovo and the EU, especially in the context of the current geopolitical dynamics in the region, rapid major shifts in world politics and growing competition with authoritarian regimes;

    3.  Supports Kosovo’s application for EU membership, which reflects the overwhelming cross-party consensus on EU integration and a clear geopolitical strategic choice; reiterates its call on the Member States in the Council to mandate the Commission to present its questionnaire and to submit its opinion on the merits of the country’s application; calls on the five non-recognising Member States that have not yet recognised Kosovo’s independence to do so without delay and thus allow Kosovo to progress on its EU path on an equal footing with the other candidate countries; recalls the advisory opinion of the ICJ dated 22 July 2010, which states that Kosovo’s unilateral declaration of independence does not violate general international law;

    4.  Recalls that membership of the European Union is based on a merit-based process, conditional on the rigorous implementation of reforms aligned with the highest European standards, in particular compliance with the Copenhagen criteria and the rule of law, and ensures the effective application of laws in practice; encourages Kosovo to continue its efforts in this regard, by further strengthening its commitment to the values and standards of the Union; stresses that enlargement also implies thorough preparation of potential new members, while respecting the economic stability of the internal market, social and environmental standards and the proper functioning of the European institutions;

    5.  Welcomes the visa liberalisation, adopted in April 2023 and in place since 1 January 2024, as a tangible result of Kosovo’s ever-closer relations with the EU and as evidence of Kosovo’s efforts on the path of European integration; welcomes Kosovo’s decision to unilaterally abolish visa requirements for citizens of Bosnia and Herzegovina; welcomes the decision of Spain to recognise ordinary passports issued by Kosovo as valid travel documents as of January 2024;

    6.  Notes the tangible progress in the areas of justice, freedom and security, the fight against organised crime and a functioning market economy; regrets the limited progress and calls for an acceleration of reforms in the area of rule of law; welcomes Kosovo’s ambition to advance the implementation of reforms, which remains the country’s priority; regrets the lack of a decision-making quorum in the Kosovo National Assembly, caused by the boycott of the Assembly work by political parties ahead of parliamentary elections;

    7.  Regrets the politicisation of institutions such as the Central Election Commission and the IMC;

    8.  Commends Kosovo’s ongoing alignment with the EU’s foreign and security policy, in particular its firm condemnation of Russia’s war of aggression against Ukraine, and its implementation of the EU’s restrictive measures against Russia and Belarus, aligning with the Union’s foreign policy, and its support through humanitarian aid and military assistance packages to Ukraine, which confirm that Kosovo is a reliable and valuable partner committed to EU integration and confirms its clear geopolitical orientation, firmly anchored in the European and transatlantic alliance;

    9.  Calls for the immediate lifting of the EU measures against Kosovo, which are no longer justified as Kosovo has fulfilled the EU requirements and as the measures also stand in gross contradiction to Kosovo’s demonstrated commitment to European values and alignment with EU policies, limiting the impact of the EU’s partnership with Kosovo and hindering the resumption of the Belgrade-Pristina dialogue in good faith;

    10.  Reiterates its full support for Kosovo’s application for membership of the Council of Europe and for the country’s strategic orientation plan to join the NATO Partnership for Peace programme and its bids to join other international organisations; calls on the relevant organisations and the Member States to proactively support Kosovo’s respective bids; calls on the Commission and the EU Office in Kosovo to step up their efforts in enhancing visibility and promoting the role, efforts and benefits of the closer partnership between the EU and Kosovo;

    11.   Welcomes the fact that Kosovo reduced administrative burden by simplifying procedures through the implementation of the related program for 2022-2027; notes that the strategic framework for public administration is in place, but not efficiently implemented; regrets the fact that delays in public administration reform have left EU funding management weak and that accountability in the public sector is insufficient; calls on Kosovo to improve public administration and the merit-based civil service system by amending and adopting the Law on public officials and the Law on the independent oversight board of civil service;

    12.  Regrets that the Kosovo Constitutional Court ruling on the Law on salaries, which unifies the current system of remuneration for public officials, is not yet functional; calls on the Kosovo Government to revise its legislation on public financial management to meet international standards and to incorporate the public investment methodology into the revised legislation;

    Democracy and the rule of law

    13.  Welcomes the important and positive progress on addressing many of the EU Election Observation Mission’s (EU EOM) long-standing recommendations and on presenting a consensual law on general elections; notes that this provides an adequate basis for the conduct of democratic elections, in line with international and regional standards; notes that in response to an invitation by the president of Kosovo, the European Union deployed an EU EOM, including an observer delegation of Members of the European Parliament, to observe the parliamentary elections in Kosovo on 9 February 2025; welcomes the conclusions of the EU EOM confirming the conduct of peaceful, free and fair elections on 9 February 2025 with the participation of all communities in Kosovo; regrets the harsh rhetoric of the political parties during the campaign; takes note of the technical problems encountered during the counting process and encourages the Kosovo authorities to increase their efforts to improve the organisation of the next elections; notes the lack of genuine political pluralism within the Kosovo Serb community at the parliamentary elections, despite multiple Kosovo Serb electoral lists; is concerned by reports of continuous pressure on voters from the Serbian community exercised by Belgrade; condemns the repeated interference in the electoral campaign by US Special Envoy Richard Grenell;

    14.  Notes with concern the political deadlock caused by the fragmented political landscape and failure so far to elect a speaker of the Parliament, hindering the formation of a government following the legislative elections of 9 February 2025 and delaying the parliamentary reading of several budgetary texts; encourages the political parties to work together to overcome this stalemate as soon as possible;

    15.  Notes with concern that the Law on Local Elections and the Law on General Elections are still not implemented and harmonised with the Law on Gender Equality, which mandates 50 % equal representation of women and men; regrets that women continue to be underrepresented;

    16.  Welcomes the adoption of the law on the Special Prosecution Office and the progress in adjudicating corruption cases; commends the active work of the Special Prosecution Office for solving seven war crime cases; calls for further clarification of the division of jurisdiction between the Special Prosecution Office and the Basic Prosecution in handling investigations and prosecutions; calls on Kosovo to continue strengthening the Special Prosecution Office by enhancing its capacity to investigate and prosecute high-profile organised crime cases; calls on the police and Special Prosecution Office to work closely together to develop strategies for conducting investigations more effectively, with a clear division of responsibility;

    17.  Takes note of the progress in Kosovo’s ranking in the Corruption Perceptions Index, as it has moved upward 10 places since last year, considering it to be a positive development while acknowledging that this is attributable both to decreases in other countries’ scores and, more significantly, to the adoption of qualitative legislation, but that it still remains largely unsatisfactory; emphasises that gaining people’s trust requires not only legislative reforms but also visible results in investigating, prosecuting and convicting cases of corruption at all levels; regrets that Kosovo has lacked an anti-corruption strategy since 2019 and urges for more efforts to finalise it as a matter of priority; reiterates that strong political commitment is necessary to establish a solid track record in fighting high-level corruption; reiterates that strong political commitment is necessary to establish a solid track record in fighting high-level corruption;

    18.  Expresses serious concern about systemic vulnerabilities in Kosovo’s judiciary, particularly regarding the independence of the justice system and respect for separation of powers; reiterates its concern about delays to trials and continued criticism by government officials of judicial decisions in individual cases; welcomes the fact that in December 2024, the government submitted its draft legislation on judicial reforms to the Venice Commission and that the first opinion was issued by the latter on 18 March 2025; calls on Kosovo to ensure that legislation governing the integrity and accountability of the judiciary is consistent with European standards and Venice Commission recommendations; calls on the Government of Kosovo to allocate adequate budget for the judicial system; welcomes the establishment of the Commercial Court, progress in the recruitment of new judges and prosecutors in a merit-based and transparent process, and an overall increase of transparency;

    19.  Welcomes the participation of Kosovo Serbs in the parliamentary elections and encourages their elected representatives to play an active role within the Kosovo legislative framework, in support of Kosovo’s European future; regrets, however, the boycott of parties representing Kosovo Serbs during the local elections in April 2023 and the withdrawal of Kosovo Serbs from Kosovo institutions; expresses concern over Serbia’s interference in the parliamentary elections through Srpska Lista (SL);

    20.  Welcomes the implementation of the 2016 judgement of the Constitutional Court on the Visoki Dečani/Deçani Monastery land ownership by registering the monastery as the owner, in March 2024;

    21.  Welcomes the steady increase in organised crime sentences and the fact that the legal framework on the fight against organised crime is aligned with the EU acquis; emphasises the need for prosecution services and police to strengthen their joint action against criminal groups and networks; expresses concern about the security challenges in the north of Kosovo, particularly following the Banjska/Banjskë attack in September 2023, which demanded significant police resources; emphasises the need to deepen cooperation in the field of combating drug trafficking; calls for further alignment regarding the fight against terrorism;

    22.  Welcomes the adoption of the strategy and action plan on control of small arms light weapons and explosives, as well as the high level of compliance with the rules of the UN Firearms Protocol;

    23.  Remains concerned over the slow implementation of the rule of law strategy and action plan;

    24.  Reaffirms its commitment to maintaining and strengthening its cooperation with the Kosovo Assembly and its members in support of democratic processes related to Kosovo’s European path by using Parliament’s existing democracy support tools and initiatives; believes that this partnership can be revitalised and further reinforced following the democratic elections held on 9 February 2025; encourages the active involvement and collaboration of all elected members of the newly formed Kosovo Assembly;

    25.  Condemns the serious security incidents in the north of Kosovo in late November 2024, the gravest act occurring near the village of Vragë in Zubin Potok, where explosive devices damaged critical infrastructure by targeting the main channel of the Ibër Lepenc system; expresses its support for Kosovo’s institutions in conducting a full investigation of these criminal actions so that the perpetrators will be brought to justice;

    26.  Commends the work of EULEX, which has been assisting Kosovo authorities in establishing sustainable and independent rule of law institutions;

    Fundamental freedoms and human rights

    27.  Notes that Kosovo has the necessary institutional set-up for the promotion and protection of human rights; welcomes the adoption of the strategy for the protection and promotion of the rights of communities; emphasises, however, that human rights protection remains weak owing to the lack of legislative implementation, political will and limited human and financial resources and calls for strengthened enforcement and accountability mechanisms;

    28.  Acknowledges that Kosovo’s constitution is very progressive in terms of protection of minority rights; notes with regret that the petition signed by nearly 500 people who have historically self-identified as Bulgarian, which was registered at the Assembly of Kosovo in January 2023, has still not been considered and recommends that those rights be enshrined in law and ensured in practice; calls on Kosovo to ensure that all minorities recognised under the Law on protection of minority rights and members of their communities, are fully incorporated into the country’s constitution; calls on the Kosovo authorities to step up efforts to protect the rights of all minorities, including national communities, in particular vulnerable national communities, and to provide them equal opportunities and adequate representation in political and cultural life, public media, the administration and the judiciary, as well as prevent their assimilation and promote their integration into Kosovo’s society and strengthen activities to eliminate social and economic challenges of these national minorities;

    29.  Welcomes the increase in funding to shelters for victims of domestic violence and trafficking; notes that domestic violence remains the most common form of gender-based violence; expresses concerns that the system continues to fail in ensuring the effective prevention of domestic violence;

    30.  Regrets that the adoption of the draft Civil Code of Kosovo remains pending; highlights that the draft Civil Code addresses several important issues related to gender equality as a fundamental EU value, including enabling an equal share of joint marital property among women and men spouses; stresses the importance of ensuring rights for all people in Kosovo in the Civil Code to safeguard respect for constitutional rights and opportunities for the LGBTIQ community; expresses concern that women remain under-represented in senior political positions, specifically related to security and the dialogue, and emphasises the urgent need for their involvement in peacemaking and reconciliation processes, in line with United Nations Security Council Resolution 1325 on Women, Peace and Security; calls for more efforts to be made to improve the place of women in society;

    31.  Notes that the prison system broadly follows UN Standard Minimum Rules and calls for the better protection of the rights of prisoners, particularly female, minority and mentally ill prisoners; remains concerned that discriminatory language against women and LGBTIQ people persists, and calls on the authorities to create and implement a national gender strategy for research fields, such as science, technology, engineering, and mathematics; commends the participation of women in high-quality business and management training programmes, as well as in ICT related domains, facilitated by the instrument for pre-accession assistance funds; regrets that women from minority groups, particularly the Roma, Ashkali and Egyptian communities, face numerous forms of discrimination, particularly in education, employment and access to healthcare; expresses concerns that the central administration does not adequately represent minority communities, and the number of women in senior positions is low;

    32.  Regrets that the UN Convention on the Rights of Persons with Disabilities has not yet been adopted; expresses concerns that there is insufficient alignment between Kosovo’s legislation and the EU acquis on the rights of people with disabilities, who face discrimination and barriers to accessing social services;

    33.  Welcomes Kosovo’s consistent improvement in its position in the 2024 Liberal Democracy Index and Electoral Democracy Index, as prepared by the Varieties of Democracy Institute, which measures the rule of law, checks and balances, civil liberties, and free and fair elections;

    34.  Takes note of Kosovo’s pluralistic media environment while awaiting the decision of the Constitutional Court on the main media law and underlines the role of the IMC, whose independence in decision-making needs to be strictly ensured and full functioning restored; regrets, however, the decline in Kosovo’s media freedom, as evidenced by its drop from the 56th to the 75th place in the 2024 World Press Freedom Index; reaffirms that media pluralism and transparency are prerequisites for EU accession; calls for greater transparency on media ownership and financing with a view to enhancing media independence and pluralism; emphasises the need for robust measures to protect journalists from harassment and intimidation, and to ensure the independence of media regulatory bodies; notes the concerns raised by civil society about the allegedly politically motivated election of the Chair of the IMC; urges the Kosovo authorities to further revise the Law on the IMC in order to include the recommendations made by the Council of Europe, thus aligning the national law with EU standards and practices; recommends increased support for independent media outlets and fact-checking organisations in Kosovo, recognising their crucial role in countering disinformation and providing accurate information to the public; encourages the EU to provide technical and financial assistance to these entities; encourages the Kosovo authorities to request tailor-made Technical Assistance and Information Exchange expert missions bodies; calls for the adoption of the law on Radio Television of Kosovo and the law on the protection of journalists’ sources;

    35.  Expresses concern over the recent cyberattack targeting Kosovo’s digital infrastructure; urges the Kosovo Government to reinforce its capacities to combat foreign interference and disinformation, particularly those originating from Serbian nationalist outlets and Russia, aimed at destabilising the region and undermining the European integration of the Western Balkans, by developing comprehensive strategies that include public awareness campaigns also combating disinformation undermining women’s participation in public life, strengthening cybersecurity and related infrastructure, fostering collaboration with international partners, most notably the European Union, to protect its digital economy, public services and national security, and addressing disinformation campaigns and hybrid threats that aim to destabilise the country and undermine its European perspective; encourages the integration of media literacy programs into Kosovo’s educational curriculum to equip citizens with the skills necessary to identify and counteract disinformation;

    36.  Commends the fact that Kosovo provided shelter and asylum to journalists from Ukraine and Afghanistan;

    37.  Expresses serious concern about the significant increase in attacks against journalists and strategic lawsuits against public participation (SLAPP cases), including by government officials; calls on the authorities to advance their work on anti-SLAPP legislation in line with the new EU Directive 2024/1069(7); calls on Kosovo to work actively to secure the ability of journalists to carry out their work and to ensure full freedom for the media to operate independently; underlines the need to stop all forms of violence;

    38.  Welcomes Kosovo’s vibrant and constructive civil society, which plays a very crucial and positive role in the reform process; encourages the Kosovo Government to enhance its cooperation with civil society, in particular with women’s rights organisations, on decision-making and to make more use of the Government Council for Cooperation with Civil Society for building collaborative relationships and genuinely implicating civil society in a transparent legislative process from an early stage onwards; stresses the importance of increasing accountability and transparency in relation to public funding for civil society organisations; underlines that civil society is vital in fostering democracy and pluralism and promoting good governance and social progress;

    39.  Regrets the lack of a clear plan for engaging Kosovo Serbs in the north and that initiatives to involve the Serb community in Kosovo’s political, social and economic structures remain very limited; reiterates its call to improve the internal dialogue and genuinely and directly engage with the independent civil society organisations of Kosovo Serbs, in particular in the north, with the aim of building trust, facilitating the daily life of Kosovo Serbs and successfully integrating them;

    Reconciliation and good neighbourly relations

    40.  Commends Kosovo’s engagement in a number of regional cooperation initiatives and encourages it to enhance its reconciliation efforts and seek solutions to past disputes; commends Kosovo on its constructive approach and active engagement in regional cooperation and trade facilitation that led to the unblocking of the Central European Free Trade Agreement;

    41.  Calls on Serbia to open all wartime archives and grant access to the former Yugoslav Secret Service (UDBA) and Yugoslav People’s Army Secret Service (KOS) files, ensuring their return to respective governments upon request; emphasises the need to open these archives region-wide to investigate communist-era crimes and strengthen democracy, accountability and institutions in the Western Balkans;

    42.  Reiterates its full support for the EU-facilitated dialogue and welcomes the appointment of Peter Sørensen as the EU Special Representative for the Belgrade-Pristina Dialogue;

    43.  Reiterates the importance of constructive engagement on the part of the authorities of both Kosovo and Serbia in order to achieve a comprehensive legally binding normalisation agreement, based on mutual recognition and in accordance with international law; calls on both Kosovo and Serbia to implement the Brussels and Ohrid Agreements, including the establishment of the Association/Community of Serb-Majority Municipalities, and the lifting of Serbia’s opposition of Kosovo’s membership in regional and international organisations, and to avoid unilateral actions that could undermine the dialogue process;

    44.  Expects Kosovo and Serbia to fully cooperate and take all the necessary measures to apprehend and swiftly bring to justice the perpetrators of the 2023 terrorist attack in Banjska; deplores the fact that Serbia still has not prosecuted the culprits, most notably Milan Radoičić, the Vice-President of Srpska Lista; reiterates that the perpetrators of the terrorist attack in Zubin Potok must also be held accountable and must face justice without delay;

    45.  Calls on the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy and on the Commission to take a more proactive role in leading the dialogue process; calls for an enhanced role for the European Parliament in facilitating the dialogue through regular joint parliamentary assembly meetings;

    46.  Condemns all actions that endanger stability and jeopardise the reconciliation process, including the tensions in the north of Kosovo and provocations by Serbian state-sponsored groups and illegal armed formations, and urges the European Union to take a stronger stance against external interference in Kosovo’s internal affairs; emphasises that both sides must fully implement all agreements reached and avoid unilateral actions that could escalate tensions; calls on the Kosovo police to ensure that they fully abide by all rule of law and human rights requirements, and to guarantee that a multi-ethnic and inclusive police force, fully in line with legal requirements, is deployed in the north of Kosovo; recalls the shared responsibility of all political representatives and all communities in Kosovo for upholding peace, security and the rule of law;

    47.  Welcomes the establishment of the Joint Commission on Missing Persons in December 2024 and calls for swift progress in implementing the May 2023 Political Declaration on Missing Persons; calls on both Kosovo and Serbia to refrain from politicising this humanitarian issue and to step up their efforts in implementing the declaration as part of the Belgrade-Pristina Dialogue and to establish cooperation between Kosovo and Serbia;

    48.  Welcomes the recent agreements in the framework of the Berlin Process;

    49.  Welcomes Kosovo’s decision to remove restrictions on the entry of Serbian finished products at the Merdare border crossing;

    50.  Welcomes the presence of the Kosovo Force and its role in building and maintaining a safe and secure environment and in developing a stable and peaceful Kosovo on the path towards Euro-Atlantic integration; recalls the importance of the mission for the ongoing development of the Kosovo Security Force through the provision of advice, training and capacity building;

    Socio-economic reforms

    51.  Welcomes Kosovo’s active engagement in the implementation of the new growth plan for the Western Balkans, which aims to deepen EU-related reforms and reduce the socio-economic gap between EU Member States and the Western Balkan countries; welcomes the adoption of Kosovo’s Reform Agenda and recalls that Kosovo (as well as Serbia) needs to show improved commitment to the EU-facilitated Dialogue in order to access the resources;

    52.  Welcomes the progress achieved by Kosovo in developing a functioning market economy and encourages Kosovo to implement the necessary structural reforms to address fiscal challenges, while ensuring adequate labour protection, fair wages, and improved working conditions in line with EU legislation;

    53.  Reiterates its calls on the Commission to develop a regional strategy to address the persistent youth unemployment and brain drain by tackling the skills mismatch between the education system and the labour market, improving the quality of teaching, and ensuring adequate funding for active labour market measures and vocational training schemes, along with adequate childcare and pre-school education facilities;

    54.  Welcomes the fact that Kosovo’s cybercrime legislation is broadly aligned with the EU acquis; notes Kosovo’s limited progress in the digital transformation of public services; emphasises the need for it to align with EU digital legislation as well as with the needs of its people, specifically with the European Electronic Communications Code, the EU Network and Information Security Directive (NIS2)(8), the EU toolbox for 5G security, and the Digital Services Act(9) and the Digital Markets Act(10); notes that Kosovo’s economy remains highly dependent on imports and stresses the need for economic diversification to enhance competitiveness and sustainability, particularly in the context of deeper integration into EU markets;

    55.  Regrets that the draft law on textbooks, presented in 2022, is still pending final adoption in the Kosovo Assembly; calls on Kosovo to finalise the implementation of the new curricular framework for basic education, complete the revision of current textbooks, provide sustainable training to teachers, and systematically apply quality assurance mechanisms at all education levels;

    56.  Urges Kosovo to ensure better access to quality healthcare services; notes that healthcare expenditure remains the second lowest in the region, and calls for a comprehensive healthcare reform to address the needs of all citizens, especially in rural and underserved areas;

    57.  Notes with concern that access to social services, particularly for vulnerable groups, worsened with the government’s closure of the Ministry of Labour and Social Welfare, which was done without transparent consultation with civil society and other stakeholders and contributed to significant confusion; calls for better, evidence-based budgeting to improve social services, particularly for survivors of gender-based violence in accordance with the new legal framework;

    58.  Calls on Kosovo to provide equal and non-discriminatory state education in minority languages;

    59.  Reiterates the need to reach out to young people from the Serb majority municipalities and to integrate them in the socio-economic structures of the country;

    Energy, environment, sustainable development and connectivity

    60.  Notes that Kosovo has made some progress on the security of energy supply but remains heavily reliant on outdated, highly polluting power plants, posing serious health and environmental risks; notes that Kosovo needs to ensure the time-efficient implementation of its energy programme for 2022-2025 to meet its ambitious targets and reduce its dependence on fossil fuels; calls for the EU to step up and prioritise its efforts to help Kosovo overcome its air pollution problems; notes that Kosovo’s new energy strategy does not promote the construction of hydropower plants due to their harmful environmental impact, in particular because of the water scarcity in the country;

    61.  Highlights the need for comprehensive infrastructure development in Kosovo to facilitate the reduction of emissions from public transport and the expansion of electrified transport; stresses that improving accessibility and ensuring compatibility with the EU transport network must remain a priority;

    62.  Welcomes the agreement at the Tirana Summit on reduced roaming costs; calls, in this respect, on the authorities, private actors and all stakeholders to facilitate reaching the agreed targets to achieve a substantial reduction of data roaming charges and further reductions leading to prices close to domestic prices between the Western Balkans and the EU by 2027; welcomes the entrance into force of the first phase of implementation of the roadmap for roaming between the Western Balkans and the EU;

    63.  Urges Kosovo to enhance compliance with emission ceilings, improve the integration of environmental considerations into sectoral policies and adopt necessary measures for pollution, soil and water contamination control and waste management, in line with EU and international standards and commitments; urges Kosovo to improve comprehensive environmental impact assessments and to integrate sustainability measures into infrastructure planning; calls on Kosovo to increase the protected areas in the country and to improve instruments and measures for their protection with a view to safeguarding biodiversity, including key habitats of the critically endangered Balkan lynx; encourages Kosovo to intensify and speed up collaborative efforts with its neighbouring countries to designate transboundary protected areas and establish coherent transboundary management plans;

    o
    o   o

    64.  Instructs its President to forward this resolution to the President of the European Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the governments and parliaments of the Member States and the President, Government and National Assembly of Kosovo.

    (1) OJ L 71, 16.3.2016, p. 3, ELI: http://data.europa.eu/eli/agree_internation/2016/342/oj.
    (2) OJ L 195, 27.7.2017, p. 3, ELI: http://data.europa.eu/eli/agree_internation/2017/1388/oj.
    (3) OJ L 330, 20.9.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/1529/oj.
    (4) OJ L, 2024/1449, 24.5.2024, ELI: http://data.europa.eu/eli/reg/2024/1449/oj.
    (5) OJ L 146, 6.6.2023, p.22, ELI: http://data.europa.eu/eli/dec/2023/1095/oj.
    (6) OJ L 110, 25.4.2023, p. 1, ELI: http://data.europa.eu/eli/reg/2023/850/oj.
    (7) Directive (EU) 2024/1069 of the European Parliament and of the Council of 11 April 2024 on protecting persons who engage in public participation from manifestly unfounded claims or abusive court proceedings (‘Strategic lawsuits against public participation’) (OJ L, 2024/1069, 16.4.2024, ELI: http://data.europa.eu/eli/dir/2024/1069/oj).
    (8) Directive (EU) 2022/2555 of the European Parliament and of the Council of 14 December 2022 on measures for a high common level of cybersecurity across the Union, amending Regulation (EU) No 910/2014 and Directive (EU) 2018/1972, and repealing Directive (EU) 2016/1148 (NIS 2 Directive) (OJ L 333, 27.12.2022, p. 80, ELI: http://data.europa.eu/eli/dir/2022/2555/oj).
    (9) Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (OJ L 277, 27.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2065/oj).
    (10) Regulation (EU) 2022/1925 of the European Parliament and of the Council of 14 September 2022 on contestable and fair markets in the digital sector and amending Directives (EU) 2019/1937 and (EU) 2020/1828 (Digital Markets Act) (OJ L 265, 12.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/1925/oj).

    MIL OSI Europe News

  • MIL-OSI Europe: Spain: EIB finances with €20 million Heura Foods to develop innovative and sustainable plant-based food products

    Source: European Investment Bank

    • Heura Foods is a Spain based startup that produces 100% plant-based, sustainable and healthy food products with a focus on plant-based meat.
    • The agreement will finance investments to boost Heura’s R&D&I capabilities to produce new products in several categories.
    • The agreement contributes to the EIB strategic priorities of supporting European innovation and the bioeconomy sector while fostering healthy and environmentally friendly food systems in Europe.
    • The operation is backed by InvestEU, an EU programme that aims to unlock over €372 billion in investment by 2027.

    The European Investment Bank (EIB) has signed a €20 million loan with Spanish start-up Heura Foods to support development and commercialization of innovative, sustainable and healthy food products 100% plant-based. Heura is a bioeconomy pioneer and innovator in the plant-based foods sector with headquarters in Barcelona. Heura focuses on improving food composition by replacing saturated fats and cholesterol with ingredients rich in fiber and antioxidants, while ensuring a high protein content.

    The loan will support Heura’s R&D&I programme for the development of plant-based alternatives to meat, cheese, and other animal products, as well as products that incorporate a higher share of protein than conventionally found on the supermarket shelves.  Heura’s objective is to provide nutritious alternatives to traditional meat products and popular ultra-processed food categories, using legume-based proteins and healthy fats. The loan will also permit Heura to scale up its production capacity by financing investments in equipment needed to this end, both in Heura’s laboratories and in the co-manufacturers premises in Spain.  Ultimately, the agreement will contribute to fostering healthy and environmentally friendly food systems in Europe.

    “The EIB’s support for innovation and biotechnology is key to Europe’s technological leadership. With this agreement we are boosting the dynamism of the startup ecosystem in Spain and Europe and responding to new consumer needs by developing new sustainable food products,’” said Nadia Calviño, President of the EIB Group.

    “This financing agreement with Heura is a clear example of how the EIB is stepping up its support for companies that are at the forefront of the bioeconomy sector, driving innovation and sustainability across the entire value chain. By investing in the development of new plant-based foods products, the EIB is also contributing to a more sustainable and healthy food system in Europe and the overall food security of the European Union”, said EIB Director of Equity, Growth Capital and Project Finance Alessandro Izzo.

    “Innovation is our tool to live longer and better. We are committed to simple processes, legumes, healthy fats, and science in the service of collective well-being. Our goal is to democratize food that is tasty, nutritious, and aligned with today’s challenges”, said co-founder and CEO of Heura Foods, Marc Coloma.

    “For the European Commission, fostering innovation is crucial for enhancing the competitiveness of its agri-food industry. We welcome the European Investment Bank support to research and development in innovative agri-food companies. This can help the EU to unlock new economic opportunities, create high-value jobs, and solidify its position as a leader in the evolving global food landscape. This operation is a good example of what InvestEU can do to empower businesses to grow, innovate, and build a sustainable future” stated Lucas González Ojeda, Acting Director of the European Commission Representation in Spain.

    The EIB loan is guaranteed by InvestEU, the flagship EU programme to mobilize over €372 billion of additional public and private sector investment to support EU policy goals from 2021 to 2027.

    Background information

    EIB
    The ElB is the long-term lending institution of the European Union, owned by the Member States. Built around eight core priorities, it finances investments that pursue EU policy objectives by bolstering climate action and the environment, digitalisation and technological innovation, security and defence, cohesion, agriculture and bioeconomy, social infrastructure, the capital markets union, and a stronger Europe in a more peaceful and prosperous world.

    The EIB Group, which also includes the European Investment Fund, signed nearly €89 billion in new financing for over 900 high-impact projects in 2024, boosting Europe’s competitiveness and security.

    All projects financed by the EIB Group are in line with the Paris Agreement, as pledged in the group’s Climate Bank Roadmap. Almost 60% of the EIB Group’s annual financing supports projects that contribute directly to climate change mitigation and adaptation, and a healthier environment.

    In Spain, the EIB Group signed €12.3 billion of new financing for more than 100 high-impact projects in 2024, helping power the country’s green and digital transition and promote economic growth, competitiveness and better services for inhabitants.

    High-quality, up-to-date photos of our headquarters for media use are available here.

    InvestEU

    The InvestEU programme provides the European Union with crucial long-term funding by leveraging substantial private and public funds in support of a sustainable recovery. It also helps mobilise private investment for EU policy priorities, such as the European Green Deal and the digital transition. InvestEU brings together under one roof the multitude of EU financial instruments available to support investment in the European Union, making funding for investment projects in Europe simpler, more efficient and more flexible. The programme consists of three components: the InvestEU Fund, the InvestEU Advisory Hub and the InvestEU Portal. The InvestEU Fund is implemented through financial partners that invest in projects, leveraging on the EU budget guarantee of €26.2 billion. The entire budget guarantee will back the investment projects of the implementing partners, increasing their risk-bearing capacity and mobilising at least €372 billion in additional investment.

    Heura Foods

    Heura Foods is a 100% plant-based food technology startup founded by activists and born in Barcelona. It creates solutions that make the problems of the current food system obsolete and accelerate change towards a world where our daily eating habits have a positive impact on humans, the planet and other animals. While based on scientific discoveries and cutting-edge technologies, Heura’s innovations maintain the culinary traditions of the Mediterranean, including high nutritional density, positive climate impact and exceptional taste. Already a market leader in Spain, Heura is expanding the plant-based category across Europe.

    MIL OSI Europe News

  • MIL-OSI Europe: Nominees of the 2025 One World Media Women’s Solutions Reporting Award are out

    Source: European Investment Bank

    One World Media unveiled the nominees for this year’s Awards in each category, including the Women’s Solutions Reporting Award, supported by the European Investment Bank.

    After weeks of careful consideration, One World Media’s expert panel has selected three outstanding nominees in each of the 13 categories. Fifty judges from 29 countries reviewed 559 powerful entries to identify the very best journalism from across the global south.

    The judges have looked for overall merit of a story alongside criteria like relevance, substance and impact, among others. The decisions weren’t easy. But the results are now in!

    We are thrilled to present the nominees of the Women’s Solutions Reporting Award. Huge congratulations to them!

    Discover the 2025 nominees for all categories: Shortlist 2025 – One World Media

    Winners will be announced at the Awards Ceremony on 25th of June.

    Check out our latest news: One World Media Awards

    MIL OSI Europe News

  • MIL-OSI Europe: Text adopted – 2023 and 2024 reports on Serbia – P10_TA(2025)0093 – Wednesday, 7 May 2025 – Strasbourg

    Source: European Parliament

    The European Parliament,

    –  having regard to the Stabilisation and Association Agreement between the European Communities and their Member States of the one part, and the Republic of Serbia, of the other part(1), which entered into force on 1 September 2013,

    –  having regard to Serbia’s application for membership of the EU of 19 December 2009,

    –  having regard to the Commission opinion of 12 October 2011 on Serbia’s application for membership of the European Union (COM(2011)0668), the European Council’s decision of 1 March 2012 to grant Serbia candidate status and the European Council’s decision of 28 June 2013 to open EU accession negotiations with Serbia,

    –  having regard to the Brussels Agreement of 27 February 2023 and the Ohrid Agreement of 18 March 2023 and the Implementation Annex thereto,

    –  having regard to Regulation (EU) 2021/1529 of the European Parliament and of the Council of 15 September 2021 establishing the Instrument for Pre-Accession Assistance (IPA III)(2),

    –  having regard to Regulation (EU) 2024/1449 of the European Parliament and of the Council of 14 May 2024 on establishing the Reform and Growth Facility for the Western Balkans(3),

    –  having regard to the presidency conclusions of the Thessaloniki European Council meeting of 19 and 20 June 2003,

    –   having regard to the declarations of the EU-Western Balkans summits of 17 May 2018 in Sofia and of 6 May 2020 in Zagreb,

    –   having regard to its resolutions on foreign interference in all democratic processes in the European Union, including disinformation,

    –  having regard to the Berlin Process, launched on 28 August 2014,

    –  having regard to the first agreement on principles governing the normalisation of relations between the governments of Serbia and Kosovo of 19 April 2013, to the agreements of 25 August 2015, and to the ongoing EU-facilitated dialogue for the normalisation of relations,

    –  having regard to the agreement on free movement between the governments of Serbia and Kosovo of 27 August 2022, to the agreement on licence plates of 23 November 2022, and to the Energy Agreements’ Implementation Roadmap in the EU-facilitated Dialogue of 21 June 2022,

    –  having regard to the Commission communication of 5 February 2020 entitled ‘Enhancing the accession process – A credible EU perspective for the Western Balkans’ (COM(2020)0057),

    –  having regard to the Commission communication of 6 October 2020 entitled ‘An Economic and Investment Plan for the Western Balkans’ (COM(2020)0641),

    –  having regard to the Commission communication of 8 November 2023 entitled ‘2023 Communication on EU Enlargement Policy’ (COM(2023)0690), accompanied by the Commission staff working document entitled ‘Serbia 2023 Report’ (SWD(2023)0695),

    –  having regard to the Commission communication of 8 November 2023 entitled ‘New growth plan for the Western Balkans’ (COM(2023)0691),

    –  having regard to the Commission communication of 20 March 2024 on pre-enlargement reforms and policy reviews (COM(2024)0146),

    –  having regard to the Commission communication of 30 October 2024 entitled ‘2024 Communication on EU enlargement policy’ (COM(2024)0690), accompanied by the Commission staff working document entitled ‘Serbia 2024 Report’ (SWD(2024)0695),

    –  having regard to the European Council conclusions of 9 February 2023 on the EU-facilitated dialogue between Belgrade and Pristina,

    –  having regard to Article 14 of the Serbian Constitution on the protection of national minorities,

    –  having regard to the Council of Europe’s Framework Convention for the Protection of National Minorities, ratified by Serbia in 2001 and the Council of Europe’s European Charter for Regional or Minority Languages, ratified by Serbia in 2006,

    –  having regard to the European Council conclusions of 26 and 27 October 2023 on Kosovo and Serbia,

    –  having regard to the Council conclusions of 17 December 2024 on enlargement,

    –  having regard to the European Court of Human Rights order to Serbia of 29 April 2025 to refrain from using sonic devices for crowd control,

    –  having regard to the final report of the Organization for Security and Co-operation in Europe Office for Democratic Institutions and Human Rights (OSCE/ODIHR) election observation mission on the early parliamentary and presidential elections of 3 April 2022 in Serbia, published on 19 August 2022,

    –  having regard to the European Council conclusions of December 2006, to the Council conclusions of March 2020 and to the Conclusions of the Presidency of the European Council in Copenhagen of 21-22 June 1993, also known as the Copenhagen criteria,

    –  having regard to the final report of the OSCE/ODIHR election observation mission on the early parliamentary elections of 17 December 2023 in Serbia, published on 28 February 2024,

    –  having regard to the memorandum of understanding between the European Union and the Republic of Serbia on a strategic partnership on sustainable raw materials, battery value chains and electric vehicles, signed on 19 July 2024,

    –  having regard to its resolution of 29 February 2024 on deepening EU integration in view of future enlargement(4),

    –  having regard to its previous resolutions on Serbia, in particular that of 19 October 2023 on the recent developments in the Serbia-Kosovo dialogue, including the situation in the northern municipalities in Kosovo(5), and that of 8 February 2024 on the situation in Serbia following the elections(6),

    –  having regard to Rule 55 of its Rules of Procedure,

    –  having regard to the report of the Committee on Foreign Affairs (A10-0072/2025),

    A.  whereas enlargement is one of the most successful EU foreign policy instruments and a strategic geopolitical investment in long-term peace, stability and security throughout the continent;

    B.  whereas according to the Copenhagen criteria, candidate countries must adhere to the values of the Union in order to be able to join it;

    C.  whereas democracy and the rule of law are the fundamental values on which the EU is founded;

    D.  whereas in recent years, political rights and civil liberties have been steadily eroded, putting pressure on independent media, the political opposition and civil society organisations;

    E.  whereas the Fourth Opinion on Serbia of the Council of Europe Advisory Committee on the Framework Convention on National Minorities, adopted on 26 June 2019, criticised Serbia’s delays in fully implementing education rights for minorities;

    F.  whereas freedom of religion is a core European value and a fundamental human right and Serbia is therefore obliged to respect and guarantee this freedom for all individuals residing within its territory, in accordance with its international commitments and human rights obligations;

    G.  whereas in line with Chapter 23 of the acquis, Serbia must demonstrate real improvements in the effective exercise of the rights of persons belonging to national minorities;

    H.  whereas each candidate country for enlargement is judged on its own merits, including their respect for and unwavering commitment to shared European rights and values and alignment with the EU’s foreign and security policy;

    I.  whereas Serbia has not imposed sanctions against Russia following the Russian aggression in Ukraine; whereas Serbia’s rate of alignment with the common foreign and security policy (CFSP) has been steadily declining since 2021; whereas Serbia supports the territorial integrity and political independence of Ukraine, and has clearly condemned the Russian Federation’s aggression against Ukraine and voted alongside the EU in the UN, even though it has not imposed sanctions against Russia; whereas Serbia’s rate of alignment with the CFSP dropped from 54 % in 2023 to 51 % in 2024 while other candidate countries in the region – Albania, Bosnia and Herzegovina, Montenegro and North Macedonia – achieved 100 % alignment;

    J.  whereas Serbia remains a critical battleground for foreign disinformation campaigns, notably by Russia and China, which seek to create an anti-Western rhetoric; whereas the final report of the OSCE/ODHIR on the early parliamentary elections held on 17 December 2023 pointed out several procedural deficiencies, as well as the use of harsh rhetoric and the presence of consistent bias in the media that gave an unbalanced advantage to the ruling party; whereas the issues identified in that report need to be assessed thoroughly and promptly; whereas as part of the accession negotiations, Serbia adopted the Strategy for Combating Cybercrime 2019-2023 and the relevant action plans in September 2018; whereas the strategy and the relevant action plans were not renewed after December 2023; whereas Serbia did not align with the EU’s restrictive measures in reaction to cyberattacks in 2023 and 2024;

    K.  whereas the normalisation of relations between Kosovo and Serbia is a precondition for the progression of both countries towards EU membership;

    L.  whereas accession to the EU inevitably requires full alignment with the foreign policy objectives of the Union;

    M.  whereas Serbia recognises the territorial integrity of Ukraine, including the Crimean peninsula and the Donbas region;

    N.  whereas the EU is Serbia’s main trading partner, accounting for 59,7 % of Serbia’s total trade;

    O.  whereas Russia is using its influence in Serbia to try to destabilise, interfere in and threaten neighbouring sovereign states and undermine Serbia’s European future; whereas Russian propaganda outlets such as RT (formerly Russia Today) and Sputnik operate freely in Serbia and exert significant influence in shaping anti-EU and anti-democratic narratives; whereas disinformation often originates from a false or misleading statement by a political figure, which is then reported by state-owned media and subsequently amplified on social media, often with an intention to undermine political opponents and democratic principles;

    P.  whereas on 8 June 2024, an ‘All-Serb Assembly’ took place in Belgrade with the participation of political leaders from Serbia, Bosnia and Herzegovina, Montenegro and Kosovo under the slogan ‘One people, one assembly’;

    Commitment to EU accession

    1.  Notes Serbia’s stated commitment to EU membership as its strategic goal and its ambition to align fully with the EU acquis by the end of 2026; urges Serbia to deliver quickly and decisively on essential reforms, especially in cluster 1, for this very ambitious commitment to be perceived as realistic, genuine and meaningful; stresses the need for Serbia to seriously and categorically demonstrate that it is strategically oriented towards the EU, by showing strong political will and consistency in the implementation of EU-related reforms and by communicating objectively and unambiguously with its citizens about the EU, Serbia’s European path and the required reforms;

    2.  Reiterates the strategic importance of the Western Balkans in the current geopolitical context and for the security and stability of the EU as a whole; outlines that, owing to its geopolitical position, the country has a direct impact on the overall stability of the region; condemns, therefore, Serbia’s attempts to establish a sphere of influence undermining the sovereignty of neighbouring countries;

    3.  Acknowledges Serbia’s good level of preparation with regard to macroeconomic stability and fiscal discipline and the Commission’s assessment that cluster 3 is technically ready for opening but notes with concern that there has been limited or no overall progress in meeting the benchmarks for EU membership across negotiating chapters, with particular shortcomings in critical areas such as the rule of law, media freedom, public administration reform, and alignment with EU policies, particularly the EU’s foreign policy;

    4.  Regrets the fact that no substantial progress has been made on Chapter 31, as Serbia’s pattern of alignment with EU foreign policy positions has remained largely unchanged, mainly due to Serbia’s close relations with Russia; recalls that Serbia remains a notable exception in the Western Balkans regarding CFSP alignment; calls on Serbia to reverse this trend and to demonstrate positive steps towards full alignment; notes that Serbia’s rate of compliance with EU statements and declarations is increasing but remains at only 61 %; welcomes Serbia’s continued active participation in and positive contribution to EU military crisis management missions and operations;

    5.  Welcomes Serbia’s humanitarian support for Ukraine and takes note of the sale of ammunition to the value of EUR 800 million for use by Ukraine in a mutually beneficial agreement; notes that Serbia has aligned with some of the EU’s positions regarding Russia’s war of aggression against Ukraine; regrets, however, that Serbia still does not align with the EU’s restrictive measures against Russia; calls on the EU to reconsider the extent of the financial assistance provided by the EU to Serbia in the event of continued support for anti-democratic ideologies and non-alignment with the EU’s restrictive measures and the CFSP; calls on Serbia to swiftly align with the EU’s restrictive measures and general policy towards Russia and Belarus, systematically and without delay;

    6.  Stresses the importance of implementing sanctions against Russia for the security of Europe as a whole; deplores Serbia’s continued close relations with Russia, raising concerns about its strategic orientation; reiterates its calls on the Serbian authorities to enhance transparency regarding the role and activities of the so-called Russian-Serbian Humanitarian Center in Nis and to immediately terminate all military cooperation with Russia; notes Serbia’s decision to support the UN resolution condemning Russia’s aggression against Ukraine three years after the full-scale invasion; regrets President Vučić’s immediate verbal retraction of Serbia’s UN vote, calling it a ‘mistake’; considers that maintaining privileged relations with the Kremlin regime undermines not only Serbia’s credibility as a candidate country but also the trust of its European partners and the future of EU-Serbia relations;

    7.  Regrets the continued decline in public support for EU membership in Serbia and the growing support for the Putin regime, which is the result of a long-standing anti-EU and pro-Russian rhetoric from the government-controlled media as well as some government officials; calls on the Serbian authorities to foster a fact-based and open discussion on accession to the EU;

    8.  Deplores the continued spread of disinformation, including about Russia’s war of aggression against Ukraine; condemns the spillover effects of these actions in other countries in the region; calls on the Serbian authorities to combat disinformation and calls for the EU to enhance cooperation with Serbia to strengthen democratic resilience and counter hybrid threats;

    9.  Notes Serbia’s progress on aligning with EU visa policy and calls for full alignment, in particular with regard to those non-EU countries presenting a security threat to the EU, including the threat of cyberattacks; welcomes the agreement signed on 25 June 2024 between the EU and Serbia on operational cooperation on border management with Frontex, highlighting the need to act in line with fundamental rights and international standards;

    10.  Reiterates that the overall pace of the accession negotiations should depend on tangible progress on the fundamentals, the rule of law and a commitment to the shared European rights and values as well as to the Belgrade-Pristina Dialogue, which is to be conducted in good faith so that it results in a legally binding agreement based on mutual recognition, as well as alignment with the EU’s CFSP; reiterates its position that accession negotiations with Serbia should only advance if the country aligns with EU sanctions against Russia and makes significant progress on its EU-related reforms, in particular in the area of the fundamentals;

    11.  Repeats its concern regarding the appeasing approach of the Commission towards Serbia against the backdrop of the country’s year-long rollback on the rule of law, democracy and fundamental rights, as well as its destabilising influence on the whole region; urges the Commission to use clearer language, including on the highest level, towards Serbia, consistently addressing significant shortcomings, lack of progress and even backsliding, thus upholding the EU’s fundamental values;

    12.  Calls on the Serbian Government to promote the role and benefits of EU accession and EU-funded projects and reforms among the Serbian population;

    Democracy and the rule of law

    13.  Notes the ongoing challenges in ensuring judicial independence, including undue influence and political pressure on the judiciary; expresses concern about the failure to implement safeguards preventing political interference in judicial appointments and disciplinary actions against judges and prosecutors; calls on Serbia to ensure that the High Judicial Council, the High Prosecutorial Council and the Government and Parliament of Serbia effectively and proactively defend judicial independence and prosecutorial autonomy;

    14.  Stresses the importance of adopting the Law on the Judicial Academy and the Venice Commission opinion and making necessary judicial appointments to reduce existing vacancies and improve the overall effectiveness of the judicial system; notes that the delay in adopting this law has stalled key judicial reforms necessary for alignment with EU standards; calls for the draft law to be amended following transparent consultation with all relevant stakeholders, with a view to ensuring the independence and control mechanisms of the institution in order to contribute to overall judicial independence;

    15.  Notes that limited progress has been made in the fight against corruption despite the adoption of a new anti-corruption strategy for 2024-2028; calls on Serbia to adopt and begin implementing the accompanying anti-corruption action plan and to establish an effective monitoring and coordination mechanism to track progress, in line with international standards; expresses concern that corruption is still prevalent in many areas, particularly related to ‘projects of interests for the Republic of Serbia’, and that strong political will is required to effectively address corruption as well as to mount a robust criminal justice response to high-level corruption; notes that Serbia ranks 105th in the Corruption Perceptions Index 2024, well below the EU average; considers that the level of corruption in Serbia is a significant obstacle to its EU accession process; notes with concern that results have still not been delivered in cases of high public interest, after several years, such as in the long-standing cases of Krušik, Jovanjica, Savamala and Belivuk; calls on Serbia to strengthen the independence of its anti-corruption institutions by ensuring that they are adequately resourced and protected from political interference; calls on the Government of Serbia to sign the Anti-Bribery Convention of the Organisation for Economic Co-operation and Development and to fully align its legal framework on police cooperation and organised crime with that of the EU;

    16.  Welcomes the more pluralistic composition of the new parliament, with a broader representation of political parties, including parties of national minorities; notes that the early election and the corresponding break in the functioning of the government and parliament have impeded progress on reforms; notes the frequent pattern of early elections, a permanent campaign mode and long delays in forming governments, as well as the disrupted work of the national parliament, including the absence of government question-time sessions, the lack of discussion on the reports of independent institutions, and the more frequent use of urgent procedures, which lead to a lack of parliamentary legislative oversight and legitimacy and do not contribute to the effective democratic governance of the country;

    17.  Takes note of the resignation of Prime Minister Miloš Vučević on 28 January 2025, which was confirmed by the National Assembly on 19 March 2025, and of the subsequent election of the new government led by Đuro Macut, appointed on 16 April 2025; takes note of the resumption of the work of the National Assembly on 4 March 2025, after a pause of three months, and condemns all the acts of violence that occurred on this occasion;

    18.  Reiterates its readiness to support the National Assembly and the members thereof in the democratic processes related to Serbia’s European path, including the proper functioning of the parliament in accordance with its rules of procedure, by using the European Parliament’s existing democracy support tools and initiatives and by supporting increased parliamentary oversight of the EU accession process and reforms;

    19.  Takes note, with deep concern, of the final report of the OSCE/ODIHR election observation mission on the December 2023 elections; notes that in April 2024, the National Assembly formed a working group for the improvement of the election process but that, by the end of the year, it had not agreed on any legal measures to improve the election process; notes that two out of three representatives of civil society left the working group in February 2025; notes that steps were taken in the first months of 2025 on amending the Law on Unified Voter Registry but that there is no consensus among political and civil society actors on the content; calls on all parliamentary groups in the National Assembly to decide on the implementation of ODIHR recommendations, with the agreement of all groups; calls for equal treatment of all members of parliament in the work of the National Assembly, consistent and effective implementation of the parliamentary Code of Conduct and the impartial sanctioning of breaches of parliamentary integrity;

    20.  Is concerned about the increasing role of foreign information manipulation and interference (FIMI) and foreign cyber operations and interference in Serbia’s democratic election processes;

    21.  Stresses the critical importance of ensuring the independence of key institutions, including media regulators such as the Regulatory Authority for Electronic Media (REM); regrets the delay in the election of the new members; regrets the irregularities in the nomination process; notes the withdrawal of several candidates from the selection in February 2025, who justified their decision on the basis of these irregularities; deeply regrets the fact that the REM neglected its legal obligations to scrutinise the conduct of the 2023 election campaign in the media in a timely manner, to report on its findings and to sanction media outlets that breached the law, spread hate speech or violated journalistic standards; notes, with concern, the absence of pluralistic political views in the nationwide media; notes that the REM should actively promote media pluralism and transparency regarding the ownership structures of media outlets and independence from foreign actors;

    22.  Notes that the REM awarded four national frequencies to channels that have a history of violating journalistic standards, including using hate speech and misleading the public, not complying with warnings issued by the REM, spreading disinformation and supporting the Kremlin’s narrative on Russia’s war in Ukraine; deeply regrets the fact that REM has not issued the fifth national licence and calls for it to be awarded through a transparent and impartial process without unnecessary delay and in compliance with international media freedom standards as soon as a new REM council is elected; calls for the Serbian Government to scrap and re-start the process of electing new members, in line with Serbian law and international media freedom standards;

    Fundamental freedoms and human rights

    23.  Expresses its sincere condolences to the families of the 16 victims who lost their lives and to those who were injured following the collapse of the canopy of Novi Sad train station on 1 November 2024; calls for full and transparent legal proceedings following the investigation by the authorities, to bring those responsible to justice; underlines the need to examine more broadly to what extent corruption led to the lowering of safety standards and contributed to this tragedy;

    24.  Regrets the delayed response and accountability of the Serbian authorities, the slow investigation process and the lack of transparency in the aftermath of the tragedy, which were partially addressed in the face of escalating public pressure;

    25.  Expresses deep concern about the systemic issues highlighted by the student protests and various other protests in Serbia, such as issues relating to civil liberties, separation of powers, corruption, environmental protection, institutional and financial transparency, especially in relation to infrastructure projects, and accountability; regrets the fact that the government missed the opportunity to meet the demands of the students and of the citizens who support the students in good faith; affirms that the students’ demands align with reforms that Serbia is expected to implement on its European path;

    26.  Underlines the importance of freedom of speech and assembly; calls on the authorities of Serbia to ensure the protection of those participating in the peaceful protests; takes note of the mass protests on 15 March 2025, the largest in the modern history of Serbia; calls for an impartial investigation of the claims that unlawful technology of crowd control was used against the protesters, causing injuries to a number of them;

    27.  Deplores the continuing violence against students, including the recent incident at the Faculty of Sports and Physical Education building in Novi Sad, in which at least five people were injured as a result of the police storming the building accompanied by the Dean, Patrik Drid;

    28.  Condemns, in the strongest terms, the misuse of personal data from public registries to retaliate against peaceful protesters; calls on the prosecution office in Serbia to file charges against all persons who physically attacked and incited violence against the participants of the demonstrations; is deeply concerned about any act of violence; is carefully following developments as regards arrests of protesters and legal proceedings that have been opened against them; is concerned about the reports that the security services were involved in intimidation and surveillance of the protesters; condemns the language used by the Serbian authorities inciting violence against students and other protesters; notes that student activists have faced legal harassment, intimidation and excessive use of force by the authorities; calls for a thorough, impartial and speedy investigation into allegations of violence used against demonstrators and police misconduct during protests; urges the diplomatic missions of the EU and the Member States to continue to monitor closely the ongoing legal cases relating to the protests;

    29.  Is deeply concerned about the increasing political and financial pressure on primary and secondary school teachers, as well as university professors, who were deprived of their salaries for taking part in the collective action to support students’ demands; deplores in this context the unacceptable legal proceedings and media smear campaign against the Rector of the University of Belgrade;

    30.  Is deeply alarmed that the Serbian authorities have engaged in widespread illegal surveillance practices using spyware against activists, journalists and members of civil society, as indicated in the recent reports by Amnesty International and the SHARE Foundation; urges the Government of Serbia to immediately cease the use of advanced surveillance technology against activists, journalists and human rights defenders, and calls on the competent state authorities to conduct a thorough investigation into all existing cases of unlawful surveillance and use of spyware and to initiate appropriate proceedings against those responsible; calls on the European Commission, in the light of this, to follow up on these incidents, address these issues with the Serbian authorities and insist on a thorough investigation into these matters;

    31.  Deplores the alleged illegal wiretapping and detention of five activists from the opposition Movement of Free Citizens (PSG) and a student from the STAV organisation in March 2025, and the arrest warrants issued for other STAV activists; condemns the use of the case by the propaganda media and the unfounded extension of the detention; calls on the Serbian authorities to release Marija Vasić, Lazar Dinić, Mladen Cvijetić, Lado Jovović, Srđan Đurić and Davor Stefanović from detention;

    32.  Rejects allegations that the EU and some of its Member States were involved in organising the student protests with a view to triggering a ‘colour revolution’; strongly condemns, in that context, the unlawful arrests and expulsions of EU citizens and the public disclosure, by convicted war criminals, of the personal data of EU citizens, as well as hate speech against national minorities; expresses concern about the rising number of detention cases involving EU citizens at Serbia’s border; notes that anti-EU narratives are being manifested in decreasing support for EU integration in Serbian society and in a strengthening of the presence of foreign autocratic actors in the country;

    33.  Calls on the Serbian authorities to restore citizens’ confidence in state institutions by granting transparency and accountability; encourages all political and social actors to engage in an inclusive, substantive dialogue aimed at fulfilling EU-related reforms;

    34.  Notes that media freedom in Serbia has deteriorated further, as evidenced by Serbia’s drop to 98th place in the 2024 Reporter Without Borders World Press Freedom Index; urges Serbia to improve and protect media professionalism, diversity and media pluralism, and to promote quality investigative journalism, the highest ethical journalistic standards, through respecting journalistic codes of conduct, and media literacy; recalls the importance of the plurality and transparency of the media, including on aspects related to ownership and state financing, most notably through better involvement of the REM; recalls that the concentration of media ownership can have adverse effects on the freedom of the media and the professionalism of reporting; reaffirms that, as part of the accession negotiations, Serbia needs to align with the EU in matters of strategic importance, such as countering FIMI; calls on Serbia to align with EU policies in countering foreign interference and disinformation campaigns by implementing concrete regulatory measures in line with EU standards, such as the provisions included in the Digital Services Act(7) and Regulation (EU) 2024/900 on the transparency and targeting of political advertising(8); encourages cooperation between Serbia, the European External Action Service and the European Centre of Excellence for Countering Hybrid Threats in tackling disinformation; expects the authorities to investigate and prosecute all instances of hate speech, smear campaigns and strategic lawsuits against journalists;

    35.  Expresses its deep concerns about reported cases of abusive attacks, digital surveillance and harassment against journalists, human rights activists and civil society organisations, most recently a police raid on 25 February 2025 on four leading civil society organisations, ostensibly regarding their misuse of US Agency for International Development funds; strongly condemns persistent smear campaigns and intimidation against civil society in Serbia, including false allegations about plots to overthrow the government with foreign support;

    36.  Expresses concern that civil society organisations in Serbia face increasing challenges, including restrictive conditions, funding constraints, police raids and other forms of intimidation from state authorities; underlines the importance of a framework that enables local, vibrant civil society organisations to operate freely and participate in policymaking, including EU integration processes, in inclusive and meaningful ways; regrets that Serbia currently does not provide a framework that enables its lively and pluralistic civil society organisations, particularly those engaged in democracy support and electoral observation, to operate freely and participate in policymaking in inclusive and meaningful ways; expresses concern about recent raids of the offices of civil society organisations; calls for investigations into all attacks and smear campaigns against civil society organisations and for the improved transparency of public funding;

    37.  Condemns the political pressure exerted on universities and other research institutions through a hasty government decree that interferes with the academic freedom of researchers and cuts their salaries; condemns the vilification of professors, researchers and other academic staff in pro-government media; deplores the increasing use of temporary contracts for teachers and other civil servants as a political tool to exert pressure and control;

    38.  Urges the Serbian authorities to expand the availability of public broadcasting services in all minority languages across the country, ensuring equal access to media for all communities, while drawing on the best practice of the region of Vojvodina;

    39.  Expresses its deep concern about the draft law submitted to the Serbian Parliament on 29 November 2024, which proposes the establishment of a Russian-style foreign agents law; reminds Serbian legislators that civil society organisations and journalists play a key role in a healthy democratic society; reiterates that such legislation is incompatible with the values of the EU; notes that multiple civil society organisations suspended their cooperation with the legislative and executive branches of the government in February 2025;

    40.  Expresses grave concern about the increasing political interference in heritage protection in Serbia, including the removal of protected status from cultural monuments and the disregard for legal procedures governing their preservation, as in the case of the Generalštab Modernist Complex;

    41.  Calls on Serbia to fight disinformation, including manipulative anti-EU narratives and, in particular, to end its own state-sponsored disinformation campaigns; condemns the opening of an RT office in Belgrade, the launch of RT’s online news service in Serbian and the continued operation of the Russian online news service Sputnik Srbija, which is used to propagate pro-Russian narratives and misinformation across the Western Balkans region; urges the Serbian authorities to counter hybrid threats and fully align with the Council’s decision on the suspension of the broadcasting activities of Sputnik and RT; is deeply concerned about the spread of disinformation about the Russian aggression against Ukraine; calls on Serbia and the Commission to bolster infrastructure to fight disinformation and other hybrid threats; condemns the increasing influence of Russian and Chinese state-sponsored disinformation in Serbia, including the dissemination of anti-EU and anti-democratic narratives;

    42.  Takes note of the adoption of the national strategy for equality and the strategy for prevention of and protection against discrimination, and calls for their full implementation and for further alignment with European standards; urges the Serbian authorities to address the recommendations of the Group of Experts on Action against Violence against Women and Domestic Violence (GREVIO), with a view to improving compliance with the Istanbul Convention ratified by Serbia; notes with concern the temporary suspension of the implementation of the Law on Gender Equality by the Constitutional Court; expresses concern about the persistent lack of adequate support for organisations promoting women’s rights and gender equality;

    43.  Deeply deplores the demographic decline in Serbia, which is being exacerbated by negative net migration due to economic hardship and political persecution; stresses that it is mainly young, educated and productive people who are being forced to leave the country, as well as those pressured and threatened on account of their political views, including Dijana Hrka, the mother of one of the victims of the Novi Sad railway station tragedy, who fears for her safety after being put under pressure by SNS supporters;

    44.  Stresses that the Serbian authorities must take concrete measures to uphold and strengthen the respect for the rights of the child in the country, including by ratifying the third Optional Protocol to the Convention on the Rights of the Child, adopting a national action plan for the rights of the child, adopting a new strategy on violence against children, given the expiry of the previous framework, and establishing a national framework to protect children from abuse and neglect;

    45.  Welcomes the fact that Belgrade Pride 2024 parade, the biggest in Serbia so far, passed off peacefully, though being protected by a high-profile police presence;

    46.  Highlights the need for strong commitment to safeguarding the rights of national minorities, ensuring their full representation at all levels of government, preserving their cultural identity through the use of their respective languages and by meeting their educational needs, freedom of expression and access to information, and to actively pursuing investigations into hate-motivated crimes as an irreplaceable part of common European values; regrets the fact that almost all national minorities are protected only formally; expresses concerns about the practice of pro forma representation of national minorities who are under government control; calls on Serbia to protect and promote the cultural heritage and traditions of its national minorities, in particular to create a positive atmosphere for education in minority languages, including by providing sufficient numbers of teachers, textbooks and additional materials, and deplores the violation of minority rights in this area; calls on Serbia to refrain from exploiting the national identities of national minorities that create division within these communities, and strongly condemns recorded cases of hate speech against some of them; notes the considerable delay in drafting a new action plan for the realisation of national minority rights and stresses the urgent need for Serbia to finalise and implement it promptly; highlights the need for the new action plan to fully incorporate the findings and recommendations of the Advisory Committee on the Framework Convention for the Protection of National Minorities;

    47.  Expresses concerns about the significant decline in the population of certain minority groups, including the Bulgarian minority; calls on Serbia to ensure the right to use names and language specific to minority groups, including women within the Bulgarian community; notes with concern that not all school textbooks have been translated into Bulgarian; calls on the Serbian Government to ensure reciprocal equal rights for the Croatian minority in Serbia as the Serbian minority enjoys in Croatia, in particular with regard to ensuring their reciprocal representation at all levels of government, including regional and local levels; reiterates its concern regarding the restrictive and arbitrary enforcement of the Law on Permanent and Temporary Residence related to the passivation of address of thousands of Albanians in the south of Serbia; emphasises the situation of the Romanian Orthodox Church in Serbia, which is not officially recognised by the state as a traditional church;

    48.  Regrets the attempts by the Serbian authorities to undermine the national identity of communities within the country; expresses concern, in this context, about the promotion of narratives such as that of the ‘Shopi nation’, which seek to erase the existence of the Bulgarian community and deny its historical roots and cultural heritage; regrets the searches carried out by the Serbian authorities at the Bosilegrad Cultural Centre and the initiation of pre-trial proceedings for ‘ethnic hatred’ against activists from non-governmental organisations;

    49.  Calls on Serbia to refrain from distorting historical events, such as the narrative surrounding the so-called Surdulica massacre, which only serve to spread division and hatred against minorities and neighbouring countries, which is incompatible with EU membership;

    Reconciliation and good neighbourly relations

    50.  Reiterates that good neighbourly relations and regional cooperation remain essential elements of the enlargement process; calls on Serbia to stop restrictions on entry for regional civil society activists and artists as such practices undermine regional dialogue and cooperation; reaffirms, furthermore, the importance of the stability of south-eastern European countries and their resilience against foreign interference in internal democratic processes; stresses the importance of Serbia developing good neighbourly relations, implementing bilateral agreements and resolving outstanding bilateral issues with its neighbours; notes Serbia’s participation in regional initiatives and its active involvement in the Growth Plan for the Western Balkans and the Common Regional Market; underlines the fact that respect for national minority rights is an essential condition of Serbia’s advancement along its European path;

    51.  Calls for historical reconciliation and the overcoming of discrimination and prejudices from the past; deplores the recent inflammatory rhetoric by the government, targeting neighbouring states that did not support the opening of cluster 3 for Serbia;

    52.  Reiterates that Serbia must refrain from influencing the domestic politics of its neighbouring Western Balkan countries, including regarding the unconstitutional celebration of Republika Srpska Day in Bosnia and Herzegovina and questioning Bosnia and Herzegovina’s court decisions;

    53.  Urges Serbia to step up its reconciliation efforts and seek solutions to past disputes, in particular when it comes to missing persons, who account for 1 782 people in Croatia, 7 608 people in Bosnia and Herzegovina and 1 595 people in Kosovo; calls on the Serbian authorities to achieve justice for victims by recognising and respecting court verdicts on war crimes, fighting against impunity for wartime crimes, investigating cases of missing persons, investigating grave sites, and supporting domestic prosecutors in bringing perpetrators to justice, which requires the cooperation of other parties too; strongly condemns the widespread public denials of international verdicts for war crimes, including the denial of the Srebrenica genocide;

    54.  Calls on the judicial authorities in Serbia to ensure compliance with the standards of fair trial and satisfaction of justice for victims in all war crime cases; calls for the denial of war crimes and the glorification of war criminals to be included in the Criminal Code, with a view to prosecuting any form of denial of war crimes determined by the verdicts of the International Criminal Tribunal of the former Yugoslavia and the International Court of Justice;

    55.  Reiterates its support for the initiative to establish a regional commission for the establishment of facts about war crimes and other gross human rights violations on the territory of the former Yugoslavia (RECOM);

    56.  Reiterates its position on the importance of opening and publishing wartime archives, and reiterates its call for the former Yugoslav archives to be opened and, in particular, for access to be granted to the files of the former Yugoslav secret service (UDBA) and the Yugoslav People’s Army Counterintelligence Service (KOS), and for the files to be returned to the respective governments if they so request;

    57.  Reiterates its full support for the EU-facilitated dialogue and welcomes the appointment of Peter Sørensen as the EU Special Representative for the Belgrade-Pristina Dialogue;

    58.  Reiterates the importance of constructive engagement on the part of the authorities of both Serbia and Kosovo in order to achieve a comprehensive, legally binding normalisation agreement, based on mutual recognition and in accordance with international law; calls on both Kosovo and Serbia to implement the Brussels and Ohrid Agreements, including the establishment of the Association/Community of Serb-majority municipalities, and the lifting of Serbia’s opposition of Kosovo’s membership in regional and international organisations, and to avoid unilateral actions that could undermine the dialogue process;

    59.  Expects Kosovo and Serbia to fully cooperate and take all the necessary measures to apprehend and swiftly bring to justice the perpetrators of the 2023 terrorist attack in Banjska; deplores the fact that Serbia still has not prosecuted the culprits, most notably Milan Radoičić, the Vice-President of Srpska Lista; reiterates that the perpetrators of the terrorist attack in Zubin Potok must also be held accountable and must face justice without delay;

    60.  Calls on the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy and on the Commission to take a more proactive role in leading the dialogue process; calls for an enhanced role for the European Parliament in facilitating the dialogue through regular joint parliamentary assembly meetings;

    Socio-economic reforms

    61.  Welcomes Serbia’s steady progress towards developing a functioning market economy with positive GDP growth and increased foreign investment in some sectors; takes note of that fact that Serbia received its first-ever investment-grade credit rating; underlines the fact that the EU is Serbia’s main trading partner, the largest source of foreign direct investment and by far the largest donor; reiterates that the financial assistance, which is of great benefit to Serbia, is conditional on the strengthening of democratic principles and alignment with the CFSP and other EU policies; reiterates the need for more substantial reforms in the labour market, education and public administration, including to address social inequalities; expresses concern about the scale and scope of intergovernmental contracts awarded that are exempt from the current legislative framework on public procurement; regrets, however, the fact that public debt as a percentage of GDP remains well above the eastern European average;

    62.  Is concerned about the investment in Serbia by Russia and China and their growing influence on the political and economic processes in the region;

    63.  Calls on Serbia to intensify efforts and increase investment in the socio-economic development of its border regions to address depopulation and ensure that the residents have access to essential services, including professional opportunities, healthcare and education; underlines the potential of the IPA III cross-border cooperation programmes as a key tool to promote long-term sustainable regional growth;

    64.  Welcomes Serbia’s active engagement in the implementation of the new Growth Plan for the Western Balkans; takes note of the fact that Serbia adopted its Reform Agenda on 3 October 2024; believes that embracing the opportunities of the growth plan would further enhance the Serbian economy, which over the past three years benefited from more than EUR 586 million in financial and technical assistance under IPA III; believes that the EU funding should better support the democratic reforms of the country; calls, in that context, for the relevant EU funding, including from the Growth Plan for the Western Balkans, to be reprogrammed to redirect more funds towards supporting judiciary reforms and anti-corruption measures, as well as towards independent media and civil society organisations, in order to support their critical work, in particular in the vacuum created by the withdrawal of US donors; calls, furthermore, for the EU and the Western Balkan countries to establish a framework for fruitful cooperation between the European Public Prosecutor’s Office (EPPO) and its Western Balkan counterparts in order to ensure that the EPPO can effectively exercise its power on IPA III and Western Balkan Facility funds in the recipient countries; urges the Serbian authorities to step up efforts to communicate clearly to citizens the benefits of the EU funds and to improve their visibility;

    65.  Regrets the lack of public consultation during the adoption of the Serbian Reform Agenda; calls for more effective oversight of the EU funding programmes and projects;

    66.  Advocates increased regional cooperation among Western Balkan countries to share best practice and develop joint strategies in combating disinformation and foreign interference; emphasises the role of the EU in facilitating such collaborative efforts; calls for the continuation and further reinforcement of the IPA regional cybersecurity programme;

    67.  Recognises the important role of Serbia’s business community in advancing economic convergence with the EU, including through the opportunities offered by and in the implementation of the growth plan as a sustainable alternative to Russian and Chinese investment in the country; welcomes the business community’s contribution to advancing socio-economic relations in the Western Balkans;

    68.  Takes note of Serbia’s business community’s efforts in advocating for the accession of the Western Balkans to the EU’s single market as a concrete step towards full EU membership; calls for clear, measurable actions and well-defined roles and responsibilities for the implementation of the Common Regional Market action plan, as a key driver for the region’s successful accession to the EU’s single market;

    Energy, the environment, sustainable development and connectivity

    69.  Calls on Serbia to increase its efforts towards the transposition of relevant environmental and climate acquis and to ensure the proper application of environmental protection standards, including by significantly enhancing its administrative and technical capacities at all levels of government, notably on waste management legislation and the adoption of the Climate Change Adaptation Programme and the National Energy and Climate Plan; urges the Serbian authorities to improve the transparency and environmental impact assessment of all investment, including from China and Russia;

    70.  Reiterates its regret regarding the lack of action on the pollution of the Dragovishtitsa river by mines operating in the region and the detrimental effect on the health of the local people and the environment;

    71.  Calls on Serbia to increase its efforts towards the decarbonisation of its energy system and to enable effective enforcement of pollution reduction regulations related to thermal power plants;

    72.  Emphasises the need for further progress in transboundary cooperation with neighbouring countries, especially with regard to transboundary road infrastructure; urges Serbia to begin implementing the activities outlined in the memorandum of understanding on environmental protection cooperation with Bulgaria;

    73.  Takes note of the EU-Serbia memorandum of understanding launching a strategic partnership on sustainable raw materials, battery value chains and electric vehicles, in view of the European energy transition and in line with the highest environmental standards; recalls that dialogue with the affected populations, the scientific community and civil society should be at the centre of any such strategic partnership;

    74.  Welcomes the agreement reached at the EU-Western Balkans summit in Tirana on reduced roaming costs; calls, in this respect, on the authorities, private actors and all stakeholders to facilitate reaching the agreed targets to achieve a substantial reduction of roaming charges for data and further reductions leading to prices close to the domestic prices between the Western Balkans and the EU by 2027; welcomes the entering into force of the first phase of implementation of the roadmap for roaming between the Western Balkans and the EU;

    75.  Reiterates that it is important for Serbia to continue diversifying its energy supply, to be able to break away from its dependency on Russia; takes note of the sanctions announced by the United States against Naftna Industrija Srbije (NIS), a subsidiary of the Russian Gazprom; welcomes the completion of the gas interconnector between Serbia and Bulgaria (IBS) in December 2023; regrets the postponement of the launching of the IBS’s commercial operation; calls for the swift finalisation of the permitting process to ensure its full operability in compliance with the energy community acquis; notes that Serbia is taking steps to introduce a carbon tax by 2027 as a step towards aligning with the EU emissions trading system;

    76.  Notes that all chapters in cluster 4 on the green agenda and sustainable connectivity have been opened; notes the adoption of the Law on Environmental Impact Assessment as a positive step towards environmental protection in Serbia, while expressing its regret that the new law fails to align fully with the relevant EU Directive 2014/52/EU(9), since it still leaves the opportunity for significant projects to advance without comprehensive environmental scrutiny; reiterates the need to designate and rigorously manage protected areas, particularly those identified as Important Bird and Biodiversity Areas (IBAs); calls for special attention to be given to critical sites where enforcement against poaching needs to be improved;

    o
    o   o

    77.  Instructs its President to forward this resolution to the President of the European Council, the Commission, the Vice-President of the Commission / High Representative of the Union for Foreign Affairs and Security Policy, the governments and parliaments of the Member States and the President, Government and National Assembly of Serbia.

    (1) OJ L 278, 18.10.2013, p. 16, ELI: http://data.europa.eu/eli/agree_internation/2013/490/oj.
    (2) OJ L 330, 20.9.2021, p. 1, ELI: http://data.europa.eu/eli/reg/2021/1529/oj.
    (3) OJ L, 2024/1449, 24.5.2024, ELI: http://data.europa.eu/eli/reg/2024/1449/oj.
    (4) OJ C, C/2024/6746, 26.11.2024, ELI: http://data.europa.eu/eli/C/2024/6746/oj.
    (5) OJ C, C/2024/2654, 29.4.2024, ELI: http://data.europa.eu/eli/C/2024/2654/oj.
    (6) OJ C, C/2024/6339, 7.11.2024, ELI: http://data.europa.eu/eli/C/2024/6339/oj.
    (7) Regulation (EU) 2022/2065 of the European Parliament and of the Council of 19 October 2022 on a Single Market For Digital Services and amending Directive 2000/31/EC (Digital Services Act) (OJ L 277, 27.10.2022, p. 1, ELI: http://data.europa.eu/eli/reg/2022/2065/oj).
    (8) Regulation (EU) 2024/900 of the European Parliament and of the Council of 13 March 2024 on the transparency and targeting of political advertising (OJ L, 2024/900, 20.3.2024, ELI: http://data.europa.eu/eli/reg/2024/900/oj).
    (9) Directive 2014/52/EU of the European Parliament and of the Council of 16 April 2014 amending Directive 2011/92/EU on the assessment of the effects of certain public and private projects on the environment (OJ L 124, 25.4.2014, p. 1, ELI: http://data.europa.eu/eli/dir/2014/52/oj).

    MIL OSI Europe News

  • MIL-OSI: Steadyhand Announces Unitholder Approval to Change Manager to Purpose Investments

    Source: GlobeNewswire (MIL-OSI)

    VANCOUVER, British Columbia, May 12, 2025 (GLOBE NEWSWIRE) — Steadyhand Investment Management Ltd. (“Steadyhand”) announced today that it has received unitholder approval to change the manager of the Steadyhand Investment Funds (the “Funds”) to Purpose Investments Inc. (“Purpose Investments”), a wholly owned subsidiary of Purpose Unlimited Inc. (“Purpose”). Specifically, the unitholders approved the change in manager from Steadyhand to Purpose Investments, and the change to the investment objectives of each of the Funds, all as more particularly described in the Notice of Special Meetings of Unitholders and Joint Management Information Circular dated April 7, 2025 (the “Circular”).

    “We’re pleased to report that our clients voted overwhelmingly in favour of the changes,” said Tom Bradley, Steadyhand Chair and co-founder. “This strong endorsement is a testament to the confidence our clients have in the future of Steadyhand and Purpose.”

    These changes were previously announced by Purpose and Steadyhand on March 24, 2025, in connection with the announcement that Purpose had entered into an agreement to acquire all the issued and outstanding shares of Steadyhand and Steadyhand Investment Funds, Inc. (the “Transaction”). Voting results for each of the Funds will be available under their respective profiles at www.sedarplus.ca.

    The Transaction and changes approved by unitholders are expected to be completed in and around Q2 2025, pending regulatory approvals and customary closing conditions. Additional details regarding the Transaction and the changes affecting the Funds are set out in the Circular and the simplified prospectus and fund facts for the Funds, and amendments thereto, which are available under each Fund’s profile at www.sedarplus.ca.

    About Purpose

    Purpose is a growing independent financial services firm on a mission to redefine the industry by putting customers first and delivering innovative solutions that shape the future of finance. Purpose offers cutting-edge technology and a diverse suite of financial products and services to empower Canadians with the tools and advice they need to succeed. Founded and led by entrepreneur Som Seif, the firm’s businesses span asset and wealth management and small business financing and include Purpose Investments, Driven by Purpose, Advisor Solutions by Purpose and Longevity. For more information, please visit www.purpose-unlimited.com.

    About Steadyhand

    Steadyhand is a low-fee investment firm with a mission of providing Canadians with a better investing outcome and a simpler, more personalized experience. It offers clear-cut advice, customized plans, and most importantly, a steady hand, to help investors achieve their financial goals. The firm has approximately $1.3 billion of assets under management with offices in Vancouver and Toronto.

    For further information, please contact:

    David Toyne
    Chief Development Officer
    Steadyhand Investment Funds Inc.
    1-888-888-3147

    The MIL Network

  • MIL-OSI USA: Senators Marshall, Hoeven, and Boozman Lead Effort to Bolster Crop Insurance and Reduce Costs for Farmers

    US Senate News:

    Source: United States Senator for Kansas Roger Marshall
    Washington – U.S. Senator Roger Marshall, M.D. (R-Kansas) joined U.S. Senators John Hoeven (R-North Dakota), a senior member of the Senate Agriculture Committee and Chairman of the Senate Agriculture Appropriations Committee, and Senate Agriculture Committee Chairman John Boozman (R-Arkansas) in reintroducing the Federal Agriculture Risk Management Enhancement and Resilience (FARMER) Act – legislation that strengthens crop insurance and makes increased levels of coverage more affordable for producers.
    “The FARMER Act is a major step toward ensuring the farm safety net stays intact and up to date for those who work tirelessly to provide us with food and fuel. I hear repeatedly from farmers in Kansas that crop insurance is the top priority in the Farm Bill because it provides a critically needed rapid response when disaster strikes,” said Senator Marshall.“Investing in crop insurance means protecting rural economies and securing our nation’s food supply.”
    “Crop insurance remains the number one risk management tool for our farmers, but it doesn’t provide the kind of affordable coverage options that all producers need. The result has been the repeated need for ad-hoc disaster assistance. Ultimately, producers buying higher levels of coverage will lessen the need for ad-hoc disaster assistance in the future,” said Senator Hoeven. “That means less emergency spending by the federal government, greater certainty for farmers and a more resilient ag economy. Those are wins across the board.”
    “Farmers must have the risk management tools they need to plan for the future. The Farmer Act would make critical improvements to the farm safety net and deliver support to producers across the country who rely on these programs. I appreciate Senator Hoeven for continuing to lead on this issue as we work provide certainty to America’s farm families,” said Senator Boozman.
    The legislation is also cosponsored by Senators Mitch McConnell (R-Kentucky), Joni Ernst (R-Iowa), Cindy Hyde-Smith (R-Mississippi), Jim Justice (R-West Virginia), Chuck Grassley (R-Iowa), Deb Fischer (R-Nebraska), and Jerry Moran (R-Kansas). 
    Specifically, the Federal Agriculture Risk Management Enhancement and Resilience (FARMER) Act would:
    Increase premium support for higher levels of crop insurance coverage, which will enhance affordability and reduce the need for future ad-hoc disaster assistance.
    Improve the Supplemental Coverage Option (SCO) by increasing premium support and expanding the coverage level, providing producers with an additional level of protection.
    Direct the Risk Management Agency (RMA) to conduct a study to improve the effectiveness of SCO in large counties.
    Not require producers to choose between purchasing enhanced crop insurance coverage or participating in Agriculture Risk Coverage (ARC) and Price Loss Coverage (PLC) programs, giving them flexibility to make decisions that work best for their operations. 
    This legislation is supported by the American Farm Bureau Federation, American Soybean Association, American Sugarbeet Growers Association, Crop Insurance and Reinsurance Bureau, Crop Insurance Professionals Association, Farm Credit Council, Midwest Council on Agriculture, National Association of Wheat Growers, National Barley Growers Association, National Corn Growers Association, National Cotton Council, National Sunflower Association, USA Dry Pea and Lentil Council, U.S. Beet Sugar Association, U.S. Canola Association, U.S. Durum Growers Association, and Western Peanut Growers Association.
    The full text of the legislation can be found here.

    MIL OSI USA News

  • MIL-OSI United Kingdom: £100bn potential of ‘transformational’ projects in the Highlands and Islands

    Source: Scotland – Highland Council

    Issued by Highlands and Islands Enterprise

    The scale of transformational opportunity facing the Highlands and Islands economy has been quantified for the first time in a new report.

    The study reports 251 planned development projects in the economic pipeline of what it refers to as regional transformational opportunities (RTOs).

    Together they represent a potential total investment value of up to £100.35bn, and could bring around 16,000 jobs at the peak of construction and development, and 18,000 operational jobs by 2040.

    The study was commissioned by Highlands and Islands Enterprise (HIE) in partnership with the Highlands and Islands Regional Economic Partnership (HIREP) and carried out by research specialists ekosgen.

    It will be discussed at the Convention of the Highlands and Islands meeting taking place in Strathpeffer today (Monday 12th May).

    The scale of opportunity is described in the report as ‘unprecedented’ for the Highlands and Islands and possibly even Scotland and much of the UK.

    It has the potential to far exceed previous transformational periods, including even the post-war development of the Highlands’ hydro potential and the main period of the oil and gas exploration era.

    The dual purpose of the study is to better understand the breadth of economic opportunities with the greatest potential to bring transformational change to the region’s economy and society, and to inform planning and decision-making by HIREP partners to maximise benefits.

    Renewable energy projects, including offshore and onshore wind, pumped storage hydro green hydrogen and marine energy account for around three quarters of the total RTO investment value.

    Others relate to space, marine biotech, life sciences, natural capital and critical infrastructure developments such as electricity grid upgrades improvements to ports and harbours and research and creation of innovation facilities.

    Projects are generally well dispersed across the region’s local authority areas. They include clusters of initiatives in Shetland and Orkney, Caithness and Sutherland, Lewis, Argyll and Kintyre, as well as Moray, the Inner Moray Firth and down the Great Glen.

    The RTOs are largely private sector-driven with some public sector co-investment and some investment through Growth Deals.

    The report did not look at growth projects in other industries, such as tourism, food and drink and creative industries, many of which will have significant impact at a more local level. Neither did it feature other public sector investment in the likes of roads, schools and hospitals, all of which is in addition to the RTOs.

    The authors are clear when it comes to highlighting barriers to growth that will need to be overcome, and the study explored what needs to be in place to support delivery of the RTO projects.

    The findings will be used to inform policies and planning around topics such as population attraction and retention, skills, housing provision and transport.

    A collaborative, holistic, and place-based approach is described in the report as ‘critical’ in realising the benefits of the opportunities, and something that ‘must happen at pace’.

    Stuart Black, HIE chief executive, said:

    “It would be difficult to overstate the importance of this research and its implications for the role that this region has in Scotland’s economic future.

    “We’ve certainly been aware for some time of projects at various stages of development across the region that could transform our economy and communities and significantly enhance Scotland’s economy. This report quantifies the impacts of those projects in a way we’ve not been able to do so far. The Highlands and Islands will be the engine room for growth for the Scottish economy in the years ahead.

    “We know there’s a lot to get right. Bringing these projects to fruition means addressing some serious challenges facing the region and a strong commitment to partnership. But the sheer scale of the potential prize from these efforts makes all that very worthwhile and that’s where our focus should be. The report will be crucial in informing decisions around things like planning and investment in order to realise as much of the potential benefits as possible.

    “We must support businesses and communities to ensure these investments leave a long-term legacy. We also need to work together and with businesses, social enterprises and community groups to ensure the benefits are spread across the whole region.”

    Cllr Raymond Bremner, chair of HIREP, said:

    “On behalf of the Highlands and Islands Regional Economic Partnership (HIREP), I welcome this report, which highlights the size and scale of opportunity for our region and the crucial role of local authorities and public sector bodies in fostering sustainable economies. We stand on the brink of a once-in-a-generation opportunity for economic transformation.

    “For the first time, this report quantifies 251 planned development projects, representing up to £100.35 billion in investment. These projects could create around 16,000 jobs during construction and 18,000 operational jobs by 2040. This scale of opportunity is unprecedented for the Highlands and Islands, and possibly for Scotland and the UK.

    “Investing in our workforce is essential, prioritising upskilling and reskilling to meet the demands of a green and inclusive economy, while also focusing on significant sectors such as space, marine biotech, life sciences, and critical infrastructure developments.

    “Addressing the challenges ahead demands an unwavering commitment to collaboration. HIREP will play a pivotal role in uniting partners, aligning efforts, and creating the conditions necessary for inclusive and sustainable growth. By strengthening our existing partnerships and actively engaging with our communities, we can drive meaningful progress, build long-term resilience across the region, increase job opportunities for working people, and enhance the quality of life for our communities .”

    Deputy First Minister Kate Forbes said:

    “The Scottish Government’s Programme for Government 2025 puts a clear focus on attracting investment as a key driver to creating jobs and growing our regional and national economies.

    “The skills, talent and natural resources running across the Highlands and Islands are well known but this report sets out the true scale of the opportunities that lie ahead.

    “The challenge now is to capitalise on this promise. I look forward to working alongside our public and private sector partners to deliver on this enormous potential, creating thousands of top-quality jobs for future generations.”

    Membership of the HIREP includes local authorities, Highlands and Islands Enterprise, Skills Development Scotland, Scottish Funding Council, UHI, NatureScot, VisitScotland, Bòrd na Gàidhlig, HITRANS, Cairngorms National Park Authority, the Crofting Commission, business representatives and third sector organisations.

    MIL OSI United Kingdom

  • MIL-OSI Security: ICE Arrests ‘Worst of the Worst’ Criminal Aliens in Hawaii

    Source: US Department of Homeland Security

    Targets of the operation in Hawaii included criminal illegal aliens charged with kidnapping, assault, firearms offenses, drug offenses and theft. 

    WASHINGTON – The Department of Homeland Security (DHS) announced Immigration and Customs Enforcement (ICE) has successfully detained and removed criminal illegal aliens across the U.S. including from the Hawaiian Islands.  

    Homeland Security Investigations (HSI) agents in Kona have conducted search warrants, unaccompanied minor welfare checks, and a number of targeted enforcement actions.   

    “Our brave ICE agents are conducting operations in Hawaii to protect communities from violent criminals who shouldn’t be in our country. The targets of the operation in Hawaii include criminal illegal aliens charged with kidnapping, assault, distribution of deadly drugs, domestic abuse, and theft,” said Assistant Secretary Tricia McLaughlin. “In the first 100 days under President Trump and Secretary Noem, 75% of arrests ICE made were of criminal illegal aliens. DHS is continuing to go after the worst of the worst.”  

    Below are examples of the illegal aliens ICE has removed from American communities:  

    On January 23, 2025, HSI Honolulu administratively arrested Rescue Suda, a citizen of the Marshall Islands. The Circuit Court of Hawaii County, Hawaii previously convicted Suda of Felony Assault. Suda was also arrested for kidnapping and terroristic threatening.   

    On February 25, 2025, HSI Honolulu arrested Navor Salas-Cruz, 52, a citizen of Mexico. Salas-Cruz was identified as being present in the United States after a prior order of removal. Salas-Cruz has multiple immigration encounters starting in 1996 including 2 prior removals and has a lengthy state criminal history ranging from assault, DWI, forgery, driving without a license, criminal contempt of court, family abuse. Federal charges include 8 U.S.C. § 1326(a) and 18 U.S.C § 922(g)(l) for one count of reentry of removed alien and one count of felon in possession of firearms and ammunition.  

    On January 25, 2025, HSI Honolulu arrested RJ Marsolo, a citizen of the Federated States of Micronesia.  The State of Hawaii, Circuit Court of the First Circuit, previously convicted Marsolo of assault in the first degree and assault in the third degree and sentenced him to a total of 10 years imprisonment.   

    On January 25, 2025, HSI Honolulu arrested Herman Faamausili, A citizen of Samoa.  The United States District Court, District of Hawaii, previously convicted Faamausili of distribution and possession with intent to distribute 50 grams or more of a mixture or substance containing methamphetamine and sentenced him to 70 months imprisonment.  The immigration judge ordered Faamausili’s previous removal from the United States on September 15, 2021.   

    On January 26, 2025, HSI Honolulu arrested Heine a citizen of the Federated States of Micronesia. The Superior Court of Guam convicted JAI of theft by receiving, sentencing him to 5 years in prison, and assault, sentencing him to 1 year in prison.  The immigration judge previously ordered JAI’s removal from the United States on April 16, 2020. 

    MIL Security OSI

  • MIL-OSI: Funded Ventures Launches Terrace Wealth in Partnership with Industry Veteran Ryan Bowman to Offer Tailored Wealth Management Solutions

    Source: GlobeNewswire (MIL-OSI)

    Clayton, Missouri, May 12, 2025 (GLOBE NEWSWIRE) — Funded Ventures, in partnership with industry veteran Ryan Bowman, is proud to announce the launch of Terrace Wealth, a new wealth management firm focused on delivering personalized, fee-only financial solutions. Led by Ryan, Terrace Wealth will provide individuals, families, and institutions with customized strategies for investment management and wealth building.

    Ryan is a seasoned CERTIFIED FINANCIAL PLANNER™ with over a decade of experience as a wealth advisor. Ryan was previously a partner at a Denver-based wealth management firm, where he spearheaded the successful transition from Raymond James to an independent, fee-only Registered Investment Advisor (RIA). Ryan has an MBA from Washington University in St. Louis and previously served four years in the United States Army as a combat Infantryman, earning the rank of Sergeant and was awarded the Combat Infantryman Badge. Ryan joined Funded Ventures in 2024 as an Operating Partner to launch Terrace Wealth, bringing his passion for transparent, client-focused financial strategies to the Midwest.

    Brian Wolfe founded Funded Ventures in 2017 to buy and build small businesses. Funded Ventures previously co-led the acquisition of three businesses in the SEO SaaS vertical with sale to private equity. Brian is a retired partner at Kirkland & Ellis, where he practiced for 17 years, and teaches courses on entrepreneurship through acquisition and private equity at Washington University in St. Louis, UNC Kenan-Flagler Business School and Northwestern Pritzker School of Law. Brian also serves on the board of many civic organizations including the Skandalaris Center at Washington University in St. Louis and is a member of the Young Presidents’ Organization.

    “We are excited to launch Terrace Wealth,” said Ryan. “Our goal is to provide a client-focused, holistic approach to wealth management free of conflicts of interest, combining years of experience with a deep understanding of each client’s financial needs.”

    Brian added, “Trust and transparency are essential in building long-term financial relationships. We’re committed to working closely with our clients to create tailored strategies that align with their personal and institutional goals. We’re excited to bring cutting-edge wealth management solutions to the Midwest.”

    Terrace Wealth will offer a range of services, including retirement and goal planning, cash and money management, tax optimization, estate planning, and risk management. The firm is dedicated to serving individuals, families, and institutional clients across the Midwest, providing personalized, forward-thinking financial strategies that align with their long-term objectives.

    The firm plans to grow organically and via strategic acquisition partnerships, positioning itself for long-term success in the wealth management industry. The ideal acquisition partners are fee-only planning-focused firms offering investment management. Terrace also welcomes partnerships with single-owner practices where the advisor wants (or needs) to pull back from the practice to some degree or to realize a gradual exit that retains value, income, and a more ideal day-to-day.

    For more information about Terrace Wealth and services offered, please visit www.terracewealth.com or contact Ryan Bowman at ryan@terracewealth.com or (314) 810-4012.

    About Terrace Wealth

    Terrace Wealth is a fee-only wealth management firm based in Clayton, Missouri, that provides personalized financial strategies, offering services such as retirement and goal planning, cash and money management and estate planning. Terrace Wealth aims to help clients build and manage wealth by tailoring solutions to meet their unique financial goals. 

    About Funded Ventures

    Funded Ventures was founded in 2017 to acquire and grow small businesses. The firm previously co-led the acquisition of three companies in the SEO SaaS sector, culminating in a successful sale to private equity. Funded Ventures is currently building in the home services, legal services, and home health industries. Visit www.fundedventures.com to learn more.


    Press inquiries

    Terrace Wealth
    https://www.terracewealth.com
    Brian Wolfe
    wolfebd@gmail.com

    The MIL Network